ONE of the enduring economic mysteries in Canada is why labour productivity is so dismal compared with that in America, even though the two economies are closely intertwined and are each other’s largest trading partner. Since 1980, when they were more or less at par, productivity levels in the two countries have diverged such that average output per Canadian worker in 2011 was only 78.3% of an American counterpart. A succession of governments has tried to make the economy more market-oriented by signing trade deals at the global and continental level, easing restrictions on foreign investment, lowering taxes and deregulating sectors such as air transport, electricity and telecommunications. The gap has only widened.

A report out this week by Deloitte, a business consultancy, offers a novel explanation that may be relevant to other poor performers in the productivity stakes: More than one third of Canadian companies don’t realise they are not making the necessary investments in research, machinery, equipment and technology to keep up with more competitive firms because they lack access to the kind of information they need to compare themselves with their peers. The report calls this group “over-confident” because they think they are doing better than they actually are.

In an age when many feel deluged by the amount of information available, not having enough of the stuff is an odd problem to have. Bill Currie, Deloitte’s managing director for the Americas, says information on how much companies spend on productivity-enhancing measures is collected through tax returns. However, sharing it at the level of detail required to make it relevant raises privacy concerns in a country like Canada where privately owned companies dominate in some regions or sectors.

The problem doesn’t exist in America and other big economies because the large number of companies in such places—the US has about 6m employers to Canada’s 1m—means no one firm will stand out when investment statistics are given by sector or region. (In national data releases in America, statistics are often redacted in sectors where a single firm's proprietary information could be discerned thanks to its dominance in the category.) But it may be relevant in smaller economies that lag America in labour productivity such as New Zealand or Switzerland. Industry associations could help fill the gap by more consistently gathering and sharing investment information among their members, says Mr Currie. The Canadian federal industry department is also working with the national statistical agency and academics to see if some way can be found to release at least some investment data. Of course that won’t help with another problem (this one not particular to Canada): firms tend to look inward at past practice rather than outward at the current practice of competitors when setting benchmarks.

Canadian firms are terrible laggards when it comes to spending money on research and development, machinery, equipment or technology. In the past, the low level of the Canadian dollar vis-à-vis its southern peer was blamed for dissuading companies from importing what they required. The low level of R&D investment was also linked to Canada’s important resource sector, traditionally a low spender in that area. Yet although the loonie (as the Canadian currency is called) has been trading around par since early 2010, business investment has remained sluggish. So much so that Mark Carney, now former governor of the Bank of Canada, incurred the wrath of the business community in 2012 by suggesting they stop sitting on accumulated profits, which he called “dead money”. Business leaders pointed to the uncertain global economy as a reason to keep holding on to cash.

Would having more information persuade normally risk-averse Canadian executives to open the purse strings? Not all of them would do so, concedes Mr Currie. But members of the group identified as over-confident in the survey are likely candidates because they describe themselves as optimistic about the future, supportive of innovation and not afraid to take risks.

Just about everything else has been tried to unstick Canada’s stubbornly low productivity. The one virtue of this proposed solution is that it wouldn’t cost much to implement.