Canadian anger toward U.S. President Donald Trump is understandable, but there is a real risk that this leads to poor policy choices. A case in point is the growing pressure to revisit the decision to buy a fleet of American F-35 fighter jets.
In economics, we think that governments should set policy goals, then decide how many workers to employ and how much capital equipment to use in order to achieve those goals at as low a cost as possible. A key goal underlying the decision to buy fighter jets is to protect Canada from military intervention by hostile countries. Swedish Gripen fighter jets are less costly, but also less militarily effective than the F-35s. Given this cost difference, the key question is whether the policy goal of keeping Canada safe from foreign aggression can be achieved using Gripens instead of F-35s.
