In response to the threat of Trump tariffs, an old narrative about interprovincial trade barriers has risen from the dead. The idea that eliminating supposedly massive internal trade barriers would lead to thousands of dollars per year in gains for ordinary Canadians makes for great soundbites for politicians, but should we really believe that there is a free lunch to be had?

While politicians and media figures have claimed that Canada’s GDP could grow by up to $240 billion, such incredibly large numbers simply don’t make sense based on what we know about interprovincial trade. Prior economic research on purported barriers to trade comes up with numbers that are an order of magnitude smaller.