Description
The University of Winnipeg
POL-2330-050
Government-Business Relations in Canada
Winter 2022
Case Study #1 — 20%; due date, February 11th, 2022, by 11:59 p.m.
The purpose of this case study is to explore the relationship between business and government in
Canada through a critical perspective, applying the concepts and principles discussed in class and
the course text. Read the case scenario and answer the questions posed, using complete sentences
and paragraph formation, no point form.
The case of Canada?s airline industry
Background: The airline industry in Canada has evolved over the past 90 years. For example, the
structure of Air Canada has undergrown many changes since its inception as a crown corporation
in 1937. Throughout its long history and that of other airline businesses in Canada, the
government continues to oversee this industry through the regulation of prices and route
structures, competition policy, safety regulations as well as other prescribed mandates for its
operations. In particular, the airlines industry still has significant interactions with government.
In response to COVID-19 and the new Omicron variant in December 2021, the federal
government imposed new measures on Canadian airlines to fight the spread of this new variant.
In response, WestJet CEO Harry Taylor has expressed that this intervention was ?unnecessary
disruption and chaos? and the Association of Canadian Travel Agencies warned that it will have
a ?devastating impact? on the industry (December 19, 2021).
Questions: (2 questions @ 10 points each = 20 marks)
1. In both class discussions and your text, there was a discussion on the normative and positive
aspects for the role of government. Examine these 2 perspectives in respect to Canada?s
airline industry. For example, do you agree with the government?s intervention in the
Canadian airline business with new regulations in response to COVID-19? Why or why not?
Explain your rationale for or against government intervention in private markets.
2. Examining the principle of the marginalist principle for government and business, Canada?s
federal government follows an optimum decision-making process through its advocation of
?peace, order and good government.? Alternatively, a business, cognizant of costs and
benefits, follows more of a marginal revenue and marginal cost perspective. Discuss the
dichotomy between these government values and a business approach of profitability. Are
these opposing perspectives reconcilable?
Responses to these 2 questions should be answered with several paragraphs each, to a
maximum of 2 pages. Please submit your typed responses to these questions as a Word
document on the course Nexus site.
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