This study explores disparity in regional development in Russia and in Canada and role of geography in their development. In the first chapter analysis of the role of geographic, economic, and institutional factors in economic growth over 1996-2004 is presented. Additionally the issue of the interregional spatial interaction is analyzed, which is studied in the framework of the new economic geography. The second chapter devoted to the development of Canadian provinces and analyzes factors of provincial differences along with factors of migration in Canada over the period of 1991-2001.