Browsing by Subject "hinnoittelu"

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  • Bussiére, Matthieu; Peltonen, Tuomas (2008)
    BOFIT Discussion Papers 25/2008
    Published with third author Delle Chiaie, S. in IMF Economic Review, Volume 62, Issue 1, April 2014, Pages 146-178 and ECB WP 2008 ; 951.
    This paper estimates export and import price equations for 41 countries -including 28 emerging market economies. Further, it relates the estimated elasticities to structural fac-tors and tests for statistical breaks in the relation between trade prices and exchange rates. Results indicate that (i) the elasticity of trade prices in emerging markets is sizeable, but not significantly higher than in advanced economies; (ii) such elasticity is primarily influ-enced by macroeconomic factors such as the exchange rate regime and the inflationary en-vironment, although microeconomic factors such as product differentiation also play a role; (iii) export and import price elasticities tend to be strongly correlated across countries; (iv) pass-through to import prices has declined in some advanced economies, noticeably the United States; this is consistent with a rise in pricing-to-market in several EMEs and espe-cially with a change in the geographical composition of U.S. imports. Keywords: emerging market economies, exchange rate pass-through, pricing-to-market, local and producer currency pricing, exchange rate regime. JEL classification: F10, F30, F41.
  • Kuismanen, Mika (1995)
    Suomen Pankin keskustelualoitteita 17/1995
    The purpose of this study is to examine the relationship between import prices and exchange rates in Finland.The concept of pass-through is associated with how prices of internationally traded goods are affected by changes in exchange rates. Pass-through is said to be complete when the exporter of the good does not adjust prices in his home currency.This means that exchange rate fluctuations are totally reflected in local import prices abroad.On the contrary, if import prices in local currencies remain stable, it is the prices received by exporters that must adjust to exchange rate movements.This paper presents a simple static theoretical model for pass-through.After that, some estimation results for Finnish import prices are shown.Estimation results are mixed, but it is evident that depreciation of markka increases import prices.
  • Tervala, Juha (2009)
    Bank of Finland Research Discussion Papers 28/2009
    This study analyses cross-country correlations of stock prices (values of firms) using the basic New Open Economy Macroeconomics model. We show that cross-country correlations of stock prices greatly depend on the currency of export pricing in the case of monetary shocks but not notably for temporary technology shocks. In the case of a money supply shock, the producer (local) currency pricing version of the model generates a negative (positive) cross-country correlation of stock prices.
  • Koskinen, Jenni (2008)
    Bank of Finland. Financial market report 1
    Several European clearing houses have lowered the prices of securities settlement. In Finland, prices were reduced by 10 to 50%.
  • Fedorova, Elena; Vaihekoski, Mika (2008)
    BOFIT Discussion Papers 27/2008
    Published in Czech Journal of Economics and Finance, 2009, vol.59, no.1,2-19.
    We study a pricing model for global and local sources of risk in six Eastern European emerging stock markets. Utilizing GMM estimation and an unconditional asset-pricing framework with and without time-varying betas, we perform estimations based on monthly data from 1996 to 2007 for Poland, Czech Republic, Hungary, Bulgaria, Slovenia and Russia. Most of these markets display considerable segmentation; the aggregate emerging market risk, as opposed to global market risk, is the significant driver for their stock market returns. It also appears that currency risk is priced into stock prices. The difference between local and global interest rates can be used to model the time-variation in the betas for both sources of risk. JEL Classification: G12, G15, G32 Keywords: market integration, segmentation, asset pricing, emerging markets, Eastern Europe country risk
  • Tarkka, Juha (1994)
    Bank of Finland Research Discussion Papers 1/1994
    1n this paper the theory af nonlinear multiproduct pricing is applied to the problem of determining the terms af liquid bank deposits such as cheque accounts. The prafit maximizing interest rate and service charge schedules are characterized within a madel of a manopolybank with a heterogeneous clientele. It is shown that the practice of "implicit interest", meaning below-cost pricing of payment services parallel with large interest margins on deposits, may well be part of the optimal price discrimination strategy. It is also shown that necessary conditians for that kind of cross subsidization to be optimal exist in an inventary theoretic madel of the demand for cheque account services. It is argued that the failure to take (second-degree) price discrimination into account invalidates much of the previous research on demand deposit pricing.
  • Vesala, Jukka (1992)
    Bank of Finland Research Discussion Papers 29/1992
    This paper analyzes factors affecting the pass-through from exchange rates to import prices. The prevailing market ·structure, product differentiation, intertemporal optimization and the role of expectations regarding the exchange rate are the elements whose explicit modelling enable the rationalization of the empirically observed incomplete and sluggish price response to exchange rate movements. Further, recent theories concerning hysteresis in trade prices and quantities are reviewed in order to demonstrate how large exchange rate changes may cause changes in market structure through foreign entry or exit, and/or changes in distribution capacity, and market share investments. These results are then applied to examine the dynamics of price adjustment, which is shown to be the slower the higher is the level of exchange rate uncertainty and the more significant ate the sunk investments required for market entry. An empirical study of export pricing of Finnish paper manufactures is carried out by estimating export price equations based on a mark-up pricing rule and a general error correction model as a dynamic empirical specification. The exchange rate pass-through estimates are significantly incomplete, also in the long run, and distinctly lower in exports to the USA than to West European markets. These results are generally consistent with the derived theoretical results. The huge appreciation of the US dollar during the first half of the 1980's seems to have evoked hysteretic effects in the US market for paper products as well as in Finnish exports to the USA, which show up as significant instabilities in the price equations. However, at the level of aggregate exports there is no clear evidence of such effects "following the devaluations of the Finnish mark in the observation period 1975-1991.
  • Hietala, Pekka; Jokivuolle, Esa; Koskinen, Yrjö (2000)
    Suomen Pankin keskustelualoitteita 4/2000
    The purpose of this paper is to provide an explanation for relative pricing of futures contracts with respect to underlying stocks using a model incorporating short sales constraints and informational lags between the two markets.In this model stocks and futures are perfect substitutes, except for the fact that short sales are only allowed in futures markets.The futures price is more informative than the stock price, because the existence of short sales constraints in the stock market prohibits trading in some states of the world.If an informed trader with no initial endowment in stocks receives negative information about the common future value of stocks and futures, he is only able to sell futures.Uninformed traders also face a similar short sales constraint in the stock market.As a result of the short sales constraint, the stock price is less informative than the futures price even if the informed trader has received positive information.Stocks can be under- and overpriced in comparison with futures, provided that market makers in stocks and futures only observe the order flow in the other market with a lag.Our theory implies that: 1) the basis is positively associated with the contemporaneous futures returns; 2) the basis is negatively associated with the contemporaneous stock return; 3) futures returns lead stock returns; 4) stock returns also lead futures returns, but to a lesser extent; and 5) the trading volume in the stock market is positively associated with the contemporaneous stock return.The model is tested using daily data from the Finnish index futures markets.Finland provides a good environment for testing our theory, since short sales were not allowed during the period for which we have data (27 May 1988 - 31 May 1994).We find strong empirical support for the implications of our theory.
  • Kauko, Karlo (2003)
    Bank of Finland. Discussion papers 26/2003
    Published in Journal of Banking & Finance, Volume 31, Issue 10, October 2007, pp. 2962-2977 and European Central Bank ; Working paper 427.
    Central securities depositories (CSDs) have opened mutual links, but most of them are seldom used.Why are idle links established? By allowing a foreign CSD to offer services through the link the domestic CSD invites competition.The domestic CSD can determine the cost efficiency of the rival by charging suitable fees, and prevent it from becoming more competitive than the domestic CSD.By inviting the competitor the domestic CSD can commit itself not to charge monopoly fees for secondary market services.This enables the domestic CSD to charge high fees in the primary market without violating investors participation constraints. Key words: securities settlement systems, central securities depositories, network industries, access pricing JEL classification numbers: G29, L13
  • Tarkka, Juha (1996)
    Bank of Finland. Bulletin 70 ; 1 ; January
  • Kurri, Samu (2005)
    EURO & TALOUS 3
  • Evans, George W.; Honkapohja, Seppo (2011)
    Bank of Finland Research Discussion Papers 8/2011
    Expectations play a central role in modern macroeconomics. The econometric learning approach, in line with the cognitive consistency principle, models agents as forming expectations by estimating and updating subjective forecasting models in real time. This approach provides a stability test for RE equilibria and a selection criterion in models with multiple equilibria. Further features of learning such as discounting of older data, use of misspecified models or heterogeneous choice by agents between competing models generate novel learning dynamics. Empirical applications are reviewed and the roles of the planning horizon and structural knowledge are discussed. We develop several applications of learning with relevance to macroeconomic policy: the scope of Ricardian equivalence, appropriate specification of interest-rate rules, implementation of price-level targeting to achieve learning stability of the optimal RE equilibrium and whether, under learning, price-level targeting can rule out the deflation trap at the zero lower bound.
  • Laine, Olli-Matti (2018)
    BoF Economics Review 2/2018
    This study examines the level, distribution and development of market power in Finland between 1975 and 2016. The paper applies the methods proposed by Hall (2018a) and Hall (2018b). In contrast to some other international evidence, the aggregate level of market power has not risen in Finland during the last decades. The estimate of country level markup ratio in Finland is 1,25. The paper also analyses the distribution of markup ratios across industries. About 90 per cent of industry level markup ratios are between 1 and 1,5. The results suggest that markups are typically higher in exporter firms than in non-exporter firms.
  • Forsman, Pentti; Saarenheimo, Tuomas; Terviö, Marko (1996)
    Suomen Pankin keskustelualoitteita 30/1996
    This study of markups, ie prices over marginal costs in manufacturing industries, builds on the work of Robert Hall and Werner Roeger.We analyze several methods used in estimating sectoral markups, and then apply them to empirical analysis of the industrial sectors of six EU countries (Germany, France, Italy, the UK, Sweden and Finland).We argue that measurement errors in the model variables, particularly in the rental price of capital, are likely to be a major problem in markup estimation, and show that due to measurement errors, the approach developed by Roeger is likely to produce markup estimates with an upward bias.Such biased results are particularly deceiving since the outcome tends to produce artificially good fits, high t-values, and markup estimates which are "sensible" in magnitude. We also introduce a "modified" model for markup estimation, which would, if all assumptions were fulfilled and variables correctly measured, yield results identical to those obtained with Roeger's model.Yet, in contrast to Roeger's model, in the presence of measurement errors the markup estimates produced by this model have downward bias.Comparison of these two sets of estimates enables us to assess the seriousness of the measurement problem.We found that the estimates produced by the two models differed in a systematic fashion which is symptomatic of measurement errors.All in all, our results provide strong support for our hypothesis that the markup estimates obtained with Roeger's method are likely to be artifacts created by measurement errors mainly in the rental price of capital. Key words: markup, imperfect competition
  • Leinonen, Harry (2007)
    Suomen Pankki. BoF online 4/2007
    1 Introduction 5 2 Payment services are transportation services using fund transfer systems 7 3 Costs of transportation of funds 11 4 Pricing mechanisms of payment services 14 5 Transparent surcharging or embedded merchant payment costs 17 6 The impact of cross-subsidisation, embedded prices, MIFs and different cost structures 20 6.1 Scenario 1): transparent cost-based pricing without an MIF 21 6.2 Scenario 2): mostly bank subsidised payment costs in a win-win situation without MIF 21 6.3 Scenario 3): mostly bank subsidised payment costs in a win-lose situation with MIF 23 6.4 Scenario 4): the impact of an oversized MIF 25 7 Authority reactions to perceived oversized MIFs 27 8 Embedded versus transparent prices 29 9 Summary 31
  • Murto, Risto (1993)
    Bank of Finland Research Discussion Papers 4/1993
    Työssä tutkitaan pankkiluottojen hinnoittelun vuosina 1987-1992. Perusaineistona on asiakaskohtainen otosaineisto säästöpankkien asiakkaista. Tutkittavaan periodiin sisältyvät sekä voimakkaan luottoekspansion kausi että pankkikriisin alkuvuodet. Tulosten mukaan luoton sai halvalla suhteessa viitekorkoon, jos asiakas nosti sen korkeasuhdanteen huipussa, jos korkotaso oli alhainen ja jos se sidottiin pitkäaikaiseen markkinakorkoon. Myös luoton suuri koko on alentanut luoton marginaalia. Luotto kannatti nostaa pankista, jonka markkina-asema on vahva, jonka pääkonttorin sijaintikunta on maatalousvaltainen ja jonka pääkonttorin sijaintikunnan kuntalaiset ovat varakkaita mitattuna talletukset/asukkaat-mittarilla. Tutkittavaan aineistoon sisältyy tieto asiakkaan maksuhäiriöistä. Tämä mahdollistaa myös luottotappioriskin tarkastelun. Tulosten mukaan pankin olisi pitänyt periä asiakkailtaan enemmän korkoa suhteessa viitekorkoon, jos lainalla oli henkilötakaus tai lainalla oli muu reaalikiinnitys kuin omakotitalokiinteistö. Nousukaudella ja korkealla korkotasolla myönnetyt luotot ovat olleet riskillisempiä kuin muut luotot. Myös suuri luoton koko nostaa todennäköisyyttä, että asiakkaalla on maksuhäiriöitä. Palkansaajien ja eläkeläisten lainat ovat olleet suhteellisesti riskittömämpiä kuin muiden sektoreiden luotot. Nousukauden ja kovan luotonkasvun aikana marginaalien olisi pitänyt olla erittäin suuria, jotta kasvaneet luottotappioriskit olisi kompensoitu. Käytännössä olisi tarvittu asiakkaiden tarkempaa valikointia eli pankin itsensä suorittamaa luotonsäännöstelyä. Niiden kustannusten valossa, jota nykyisestä pankkikriisistä on tullut, ajatus aggressiivisesti luottoja markkinoivasta pankinjohtajasta oli väärä.
  • Leinonen, Harry (2008)
    Bank of Finland. Expository studies. A 111
    Payment services are constantly developing. However, current payment methods have developed out of paper-based services during a period with severe limitations on ICT resources. These limitations have now almost entirely disappeared, and customers are interested in new forms of digitalised and integrated payment instruments. Within the payment industry, we can see a trend towards internationally standardised network-based services, as in several other similarly ICT-dependent industries. This publication seeks to summarise current development trends, user demands, cost and pricing issues, technology and business trends as well as official views on payment developments. It endeavours to identify the most important factors affecting future payment habits for the period post-2010. Based on the analysis, technological developments will support completely integrated electronic payments processed in real time. The mobile phone seems likely to become an important device for initiation and acceptance of payments. The information conveyed as part of a payment transaction will be extended to encompass all information necessary for further and later use (for example, ordering and invoicing data). However, the prevailing practice of widespread (cross-)subsidisation makes it hard for end-users to perceive the actual cost differences between alternative means of payment, thus delaying the adoption of more efficient payment habits. The current market structures also contain strong barriers to competition in the form of monopoly, oligopoly or service provider cooperation. Official measures by authorities to increase competition along the lines of modern policies for other network industries would speed up developments in payment services as well. Keywords: payment services, electronic payments, payment trends, future payment instruments JEL classification: G10, G18, F15, H4, L86, O33
  • Francis, Bill B.; Hasan, Iftekhar; Sun, Xian (2009)
    Bank of Finland Research Discussion Papers 7/2009
    Published in Journal of International Money and Finance, Volume 28, Issue 4, June 2009: 696-719 and Journal of Banking Regulation 2006 ; 7 ; 3-4.
    We examine how political connections impact the process of going public. Specifically, we test how political connections impact the pricing of newly offered shares, the magnitude of underpricing, and the fixed cost of going public. Based on experiences of the new public firms in the Chinese security markets and using multiple measures of political connections, we find robust evidence that issuing firms with political connections reap significant preferential benefits from going public. To be specific, we find that firms irrespective of ownership arrangements with greater political connections have higher offering prices, less underpricing, and lower fixed costs during the going-public process.
  • Freystätter, Hanna (2003)
    Suomen Pankki. E 25
    This paper investigates price setting of internationally traded goods.We develop a theoretical model that incorporates sticky prices in the currency of both the buyer (local currency pricing) and seller (producer currency pricing).The nature of price setting is thus forward looking and the exchange rate effect depends on the relative share of local currency and producer currency pricing firms in the economy.The model is estimated with Finnish foreign trade, price data for the. period 1980-1998 The estimation results seem to support the model.The estimated share of local currency pricing is 40 percent, in the export sector and 60 percent, in the import sector implying that there is limited pass-through from exchange rate to destination- country prices in both sectors. Keywords: local currency pricing, producer currency pricing, GMM, Finnish foreign trade prices
  • Suvanto, Antti (1992)
    Bank of Finland Research Discussion Papers 27/1992
    The paper attempts to formalize dealer behaviour in the foreign exchange market. The three key assumptions used in the analysis are price sensitivity of customer orders and profit maximization by dealers who are constrained by the closed position target for the end of the day. As a market maker the dealer provides liquidity services to customers by making two-way prices and by standing ready to trade at these prices on immediate demand. The paper begins with a simple one-period model assuming a monopoly dealer. This is extended to sequential pricing behaviour under transactions uncertainty (stochastic order flow). The role of information is examined separately. While the assumption of a monopolistic market structure is admittedly highly unrealistic in the case of the foreign exchange market, the same model structure also works well in a competitive environment. Competition enters the analysis in the form of customer flows and interdealer transactions. The overall picture of the market structure and price dynamics that emerges from the analysis is broadly consistent with observable facts. The results are consistent with the efficient market hypothesis in the sense that there is no possibility that any of the customers or other dealers could predict the dealer's forthcoming quotations on the basis of the dealer's past pricing behaviour. Under pure transactions uncertainty and in the absence of new information, the dealer is reluctant to make a large adjustment to prices, because frequent price revisions are generally revenue-reducing. This does not apply to situations where new information ruts the market. Any new information on forthcoming customer orders will cause a prompt change in the quoted price. Price adjustments are, however, limited by the sensitivity of customers to small price differentials. Because dealers can send orders to each other in the interbank market, the sensitivity of incoming orders to small price differentials is large. As a result, the prices quoted by different dealers cannot deviate much from each other. The price making power of each dealer is reflected in the spread. Competition reduces the spread and it approaches zero once interdealer transactions are allowed for. Under pure transactions uncertainty, the spread tends to be constant. Under competitive conditions, when the spread is very small, prices quoted by all dealers are practically equal and the share of interbank transactions in the total volume of trade is very large. Intraday volatility of exchange rate quotations stems from two sources, one representing normal order flow and the other the arrival of new information. Price uncertainty would be small if transactions uncertainty was its only source and if order flows were purely stochastic. Any new information on forthcoming customer orders increases price uncertainty. ln addition to temporal price uncertainty, instantaneous price uncertainty is present because the dealer has to make a binding two-way price without knowing what prices his competitors are quoting at the same moment. This prevents the spread from diminishing indefinitely. In times of increasing uncertainty the spread tends to widen as a result of heterogeneous and asymmetric information.