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about the Okie migration notwithstanding, interstate migration rates were low
during the Depression.”
In terms of the model, mobility brings provinces much closer in their value
of (
) thereby homogenizing the demand for welfare and insurance
across territories. Moreover, these patterns of interprovincial mobility also
contributed to a reduction in the gap between provinces in the value of
α/
1
−
α
. Being
mobile across provinces between seasons, transients and their associated risks
became a shared sector of the labor force.
Put shortly, transients did contribute to the increase of levels of risk sharing
between provinces. Meanwhile, despite the Dust Bowl exodus immortalized by
John Steinbeck, no such group of seasonally mobile rural workers/dependents
emerged in the United States as Southern Paternalism worked successfully to
limit the interstate mobility of agricultural workers. Although there were dif-
ferent degrees of specialization among the provinces, and some Premiers (like
Alberta's) developed their own attempts to cope with regional labor markets, in
Canada there was nothing like the Southern American states in terms of speci-
ficity of production or the peculiar internal equilibrium of their system of labor,
social, and political relations. In brief, even in the context of the Depression, the
labor market specificities of the American states (including not only the South,
but also some Northern and Midwestern states) reduced levels of risk sharing
between subnational units. In terms of the model, interstate differences in the
value of
δ
were higher in the United States than in Canada. In line with the
argument of this topic, in Canada I would expect a political process in which
the scope of externalities and their fiscal consequences undermines the resis-
tance towards unemployment insurance centralization. By contrast, I expect
the interplay between economic geography and mobility in the United States to
nurture political pressures to preserve a more decentralized insurance system.
In the next section, I explore whether these expectations bear any relationship
with the political processes in the two North American federations.
δ
THE POLITICAL PROCESS: A COMPARATIVE OVERVIEW
As economic conditions worsened and governments muddled through recurrent
downturns, unemployment became central to the political agenda. In Canada,
it conditioned the electoral outcomes of the competition between the liberals
(1921-1930; 1935-1941) and the conservatives (1930-1935) and the dynam-
ics of the dominion-provincial relations. In the United States as well, it shaped
the relationships between the states and the federal government. In this section,
I analyze how the different balances between economic geography and mobility
in Canada and the United States shaped key social and political actors' pref-
erences, ultimately explaining the very different responses to the problem of
unemployment in the two North-American federations. I proceed in two steps:
first I analyze the initial responses by employers and subnational governments
in Canada and the United States. These, I argue, reflect the heterogeneity of
preferences in the early post-Depression years and shape the initial responses
