Browsing by Author "Bank of Finland Economics Department"

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  • Hickok, Susan (1977)
    Keskustelualoitteita. Discussion Papers 4/1977
    Presented here is a survey of Finland's export market shares development from 1960 until 1975. It's purpose is to serve as part of a broader analysis of Finland's export competitiveness. Specifically, here Finland's foreign trade performance is analysed in terms of the changes in its yearly export market shares. The development of these shares and some suggestions as to the factors affecting Finland's competitiveness are given. However, conclusions about which factors determine any specific change in competitiveness (such as relative production costs or changes in production capacity) must be approached very cautiously as many factors are always in action at any given time.
  • James, Ian (1975)
    Keskustelualoitteita. Discussion Papers 11/1975
    In recent years there has been renewed interest in the use of monetary policy as a stabilization tool. While there has been much dispute as to the role that monetary policy should play in economic stabilization, it has become increasingly popular for academic economists, especially in North America, to view open market operations, i.e., the buying and selling of government securities, as the sine-qua-non of monetary control. Thus open market operations, through the control they exert on the money supply, are seen as the most efficient means by which the monetary authorities can affect the general level of liquidity in the economy and, therefore, as the principal tool in using monetary policy as an aid to achieving economic stability .
  • Peura, Tapio (1989)
    Bank of Finland Research Discussion Papers 36/1989
    An earlier version of this Discussion Paper was published by the Kiel Institute ofi World Economics in May 1989 (Kiel Advanced Studies Working Paper No. 167).
    The seriousness of an external imbalance should be assessed with respect its macroeconomic connections and intertemporal nature. A current account deficit reflects differences in time of saving and investment decicions of the economic agents - the households, the companies and the publie sector - as well as the international dimensions of these decisions, made possible by liberalized capital markets. In principle, respect for intertemporal budget constraints, which bind economic units, will keep foreign indebtedness on an equilibrium path and ensure the solvency of the economy in the long term. Distor~ions relating to the functioning' of markets may, however, lead to sub-optimal consumption and investment decisions and disequilibrium. The rate of growth of foreign indebtedness should be kept within the'limits set by the solvency constraint of the economy, which depends on the real rate of interest on the foreign debt and on the growth rate of the economy.
  • Hämäläinen, Timo (1976)
    Keskustelualoitteita. Discussion Papers 5/1976
    The purpose of cyclical adjustment of the current account is to estimate the underlying position of the account. The concept of the underlying position of the balance of payments, namely adjustment of current and capital account for temporary influences, is important for the assessment of medium-term adjustment and balance of payment policy.
  • Hilpinen, Jorma (1982)
    Keskustelualoitteita. Discussion Papers 4/1982
    Suomen Pankin kansantalouden osastolla on vuosina 1979 - 1980 rakennettu makrotalouden tilastoihin perustuva laskentajärjestelmä, jota käytetään suhdanne-ennusteen iteroinnissa. Laskentajärjestelmä sitoo ennustettavia ilmiöitä kuvaavat tilastot toisiinsa, sisältää niiden identiteetit ja laskusäännöt, laskee analyysin tarvitsemia tunnuslukuja ja tuottaa taulukoita. Suomen Pankissa on pitkä ennustetraditio. Nykyisen organisaation puitteissa kansantalouden osastolla on tehty ennusteita vuodesta 1972 lähtien. Suhdanteiden seuranta, ennusteiden tuottaminen ja talouspoliittisten päätösten valmistelutyöhön osallistuminen ovat osaston päätehtävät. Ennustetyössä on mukana osaston koko tutkijavahvuus - vajaat 20 henkilöä. Ennusteita tehdään säännönmukaisesti kaksi kertaa vuodessa, talvella ja alkysyksystä, ja prosessi kestää noin puolitoista kuukautta. Ennusteen aikahorisontti käsittää nykyään kuluvan ja kaksi seuraavaa vuotta. Ennusteen laajuutta kuvannee parhaiten laskentajärjestelmän muuttujamäärä, joka on yli 1 200.
  • Kerttula, Anne (1989)
    Bank of Finland Research Discussion Papers 29/1989
    This paper studies capital income taxation and household saving from three different points of view. Firstly, we work through the effects of capital income taxation in a life cycle model. There are income and substitution effects to consider, and the relative magnitude of these will determine the final outcome. Secondly, we study some long-run issues related to capital income taxation. It has quite a. few long-run effects that need to be considered if we are to use it as a policy instrument. Finally, we have a look at how the actual tax system treats the return to savings. In practice, capital income tends to be lightly taxed because of various provisions.
  • Haaparanta, Pertti (1988)
    Bank of Finland Research Discussion Papers 18/1988
    It is shown that the Dixit-Norman argument for the creation of an optimal customs union without lump sum transfers presupposes either that there exists a joint fiscal authority in the union or that lump sum transfers between national governments are possible. A necessary and sufficient condition for the decentralized implementation of the optimal union is derived. This condition is related to the old discussion of trade creation vs. trade diversion. The other contribution of the paper is to extend the Dixit-Norman argument to customs unions with factor mobility i.e. to common markets.
  • Kostiainen, Seppo; Starck, Christian (1990)
    Bank of Finland Research Discussion Papers 27/1990
    The aim of this paper is to empirically assess whether government and/or corporate sector saving influence aggregate household saving in Finland. The aim is carried out using quarterly data from the period 1960 - 1988. We use both a consumption function and an Euler equation approach, and both linear and nonlinear models are employed. We fail to document indications that household saving has been influenced by government or corporate sector saving during our sample period. Our findings suggest that households have behaved rationally on the whole in accordance with the basic permanent income hypothesis according to which government and corporate saving are not considered to be part of household disposable income. We furthermore find that a fraction of the households have been liquidity constrained, and that intertemporal substitution has been weak.
  • Forsman, Pentti; Heinonen, Tarja (1988)
    Bank of Finland Research Discussion Papers 31/1988
    We contribute to the discussion of the reasons why the supply of roundwood has lagged behind the growth of forests since the early 1970s. Our dynamic models of the roundwood market provide some evidence that the very low level of the real interest rate is an important reason for the sluggishness of fellings in private forests.
  • Hämäläinen, Sirkka (1976)
    Keskustelualoitteita. Discussion Papers 10/1976
    Suomen kansantaloudelle on koko sodan jälkeisen ajan ollut ominaista melkoinen suhdanneherkkyys. Kokonaistuotannon kasvuvauhdin vaihtelut - tosin myös kasvuvauhdin taso sinänsä - ovat olleet selvästi suuremmat kuin keskimäärin läntisissä teollisuusmaissa ja suuremmat kuin yhdessäkään muussa pohjoismaassa (kuvio).Jyrkkiin suhdannevaihteluihin on oleellisesti liittynyt korkeainflaatio, suuret hintojenvaihtelut sekä kärjistyneet ulkoiset tasapainottomuudet.
  • Kotilainen, Markku; Peura, Tapio (1988)
    Bank of Finland Research Discussion Papers 33/1988
    Finland's participation in the deepening European integration means a considerable change in her economic policy setting. Liberalization of capital movements and financial services will increase interest and exchange rate sensitivity. To maintain stability, tighter coordination of economic policies is required. The integration of Finland's foreign trade and the markets of the factors of production with the EC will cause pressures to adjust Finland's exchange rate regime to the changing conditions. Of the available alternatives participation in the European Monetary System (EMS) would seem to be excluded for political reasons. In practice, the alternatives to be considered are the pegging of the markka to the ECU basket of the EC countries, or the increase of the weight of the EC countries' currencies in the present basket. At the moment there is no need for changing the weights. The need for change would, however, increase if other EFTA countries joined the EMS or pegged their currencies to the ECU, or if the importance of the US dollar for the Finnish economy substantially decreased.
  • Tyrväinen, Timo; Pyyhtiä, Ilmo (1977)
    Keskustelualoitteita. Discussion Papers 1/1977
    Hintojen nousuvauhti on Suomessa yleensä ollut jonkinverran keskimääräistä kansainvälistä nousuvauhtia nopeampi (kuvio 1). Poikkeuksen muodostivat vuodet 1969 - 1971, jolloin vuoden 1967 devalvaation jälkeen harjoitetun vakauttamispolitiikan vaikutukset näkyivät suhteellisessa hintakehityksessä. Inflaatioherkkyyden syinä on nähty mm. talouden suuri avoimuus sekä tuotantorakenteen ja viennin yksipuolisuus, jotka mahdollistivat ulkomaisen inflaation siirtymisen täysimääräisenä Suomeen. Elinkeinoittaiset tuottavuuserot yhdessä täyskompensaatioajatteluun pohjautuvan palkkapolitiikan ja maataloustulopolitiikan kanssa ovat olleet omiaan voimistamaan ulkoisten inflaatiosysäysten vaikutuksia. Ulkosyntyisten kustannuspaineiden ohella hintojen nousualttiutta ovat lisänneet suhteellisen voimakkaaksi muodostuneet ylikysyntätilanteet, joita kysynnän sääntelypolitiikka ei ole pystynyt eliminoimaan.
  • Starck, Christian C. (1988)
    Bank of Finland Research Discussion Papers 11/1988
    Finnish money markets have undergone profound changes in recent years. In particular, the transition to a more market oriented system has changed,the way domestic interest rates are formed. This paper presents and quantifies one way of describing the structure and main linkages of the current setting. Key elements of the model are the dependence of the domestic market interest rates on the foreign interest rate, an explicit formulation of the dependence of the domestic short-term market interest rate on purely domestic factors, and explicit considerations of various institutional features af the domestic money market. Empirical evidence on the formation of the domestic shor-term and long-term market interest rates as well as short-term and long-term lending rates is presented, and the results are well in accordance with the theoretical structure of the model.
  • Skolnik, Amy (1988)
    Bank of Finland Research Discussion Papers 24/1988
    Given the interdependence of today's global markets, it would be impossible for European integration to occur without affecting the rest of the world. The current triangle between the U.S., Japan, and EC is very precarious and none of these countries can avoid the others' influences. However, this is a matter that the EC seems to be neglecting and with the coming of 1992, many countries fear that the internal market will result in a rise in trade barriers and protectionism for everyone outside. This paper looks at the reactions and concerns of the U.S. and Japan towards the internal market as well as EC relations with Eastern European and EFTA countries. Though the true affects of 1992 are impossible to predict, and the EC Commission claims that no "European fortress" is being built, many of its actions indicate otherwise. In response, much of the rest of the world is discussing alternative methods and the possibility of new trade associations. With this international cooperation in mind, it is not in the EC's best interest to alienate itself from the rest of the world's markets.
  • Starck, Christian (1990)
    Bank of Finland Research Discussion Papers 28/1990
    The aim of this note is to examine whether the empirically documented positive interest rate elasticity of aggregate consumption in Finland is an artefact due to the previously widespread credit rationing. The aim is carried out using a novel time varying parameter approach and data from the period 1960 - 1989. The empirical evidence lends further support for a positive interest rate elasticity of aggregate consumption. The elasticity seems to have increased over time, especially in recent years. To some extent, this mirrors a gradual easening up of credit rationing, which has been particularly rapid in recent years.
  • Kovanen, Arto (1992)
    Bank of Finland Research Discussion Papers 5/1992
    Financial markets in Finland have undergone important structural changes over the 1980's. Most important have been the emergence of a wellfunctioning short-term money markets and the relaxation of most of the foreign exchange controls. These elements have created a situation where the economy is increasingly dependent on the developments in the rest of the world. The present study may be viewed as an extension to Hämäläinen and Kovanen (1991). The purpose is to examine how income and exchange rate expectations influence the determination of intemational capital flows. Theoretical foundations are supported by empirical evidence. Exchange rate expectations have a statistically significant role to play in the adjustment process, in particular during the final years of 1980's. Also income expectations are important for the adjustment of the demand for money. A somewhat less important, but nevertheless interesting, result concems the possibility of short-run overshooting in the net capital flows in response to changes in domestic credit. in the short runo
  • Hämäläinen, Timo; Kovanen, Arto (1991)
    Bank of Finland Research Discussion Papers 7/1991
    This study examines, using variable-parameter regression, how the offset coefficient in the capital flow equation for Finland has changed over time. We found the constant parameter estimate of the offset coefficient to be stable and quite large. Instead, the interest rate sensitivity has increased due to the liberalization, i.e. international capital flows have become very sensitive to the interest rate differential. We also examined how international capital flows are affected by exchange rate speculations.
  • Pyyhtiä, Ilmo (1991)
    Bank of Finland Research Discussion Papers 19/1991
    In this paper the reasons for revisions of announced investment plans are analyzed theoretically and empirically. In earlier studies by the author it was shown that investment plans and final investments differ systematically from each other. The theoretical framework is based on neoclassical investment theory, rational expectations and partial adjustment of investment plans. The effects of uncertainty are also studied. The empirical results show that investment plans are endogeneous to the firm and can change as the picture of demand or relative prices of factors of production change. So, the information set relevant to the determination of investment plans can be defined with conventional investment theory. According to the estimation results, reactions to shocks decrease when the survey horizon shortens. This supports the hypothesis on the increasing revision costs of investment plans as the realization time approaches. The results concerning demand uncertainty give some support to the theoretical result that an increase in demand uncertainty may reduce investments.
  • Arimo, Antero; Pohjola, Immo (1975)
    Keskustelualoitteita. Discussion Papers 13/1975
    I JOHDANTO ..... 1 II IS - LM KEHIKKO . . . . . 7 III ERÄITÄ JULKISEN TALOUDEN VAIKUTUSTEN MITTAUSTAPOJA 16 3 .1. Kerroinanalyysi . . . . . 16 3.2. Budjettierotus . . . . . 32 3.3. Täystyöllisyysylijäämä .... 25 3,4. Valtiontalouden vaikutusten käytännön tarkas telumahdollisuudet ...... 29 IV VALTIONTALOUDEN VAIKUTUSTEN KVALITATIIVISTA TARKASTELUA ....... 33 4.1. Kotitaloudet ...... 33 4.2. Yritykset ..... 42 4.3. Kunnat ........ 46 4.4. Valtio ...... 50 4.5. Rahoitusmarkkinat ...... 57
  • Halttunen, Hannu; Hirvonen, Juhani; Lahtinen, Juhani (1974)
    Keskustelualoitteita. Discussion Papers 8/1975
    Seuraavassa esitetään suhdannemallilla tehdyn ennustelaskelman tuloksia vuosille 1974 - 1980. Lisäksi vertaillaan näitä tuloksia KT:n keskipitkän aikavälin ennusteeseen ja pyritään selvittämään ennusteiden eroja. Liiteosassa esitetään myös malliennustetta täydentävä kevään 1975 tulopoliittisia tarkistusneuvotteluja koskeva finanssipoliittinen lisälaskelma .