Browsing by Author "Korkman, Sixten"

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  • Halttunen, Hannu; Korkman, Sixten (1981)
    Bank of Finland. Series D 47
    There is an extensive theoretical literature dealing with the role of economic policy in small and open economies. The models employed in this literature often seem to yield simple and strong conclusions: under fixed exchange rates and in the long run monetary and fiscal policy will be unable to affect the level of output and emplöyment, a change in the exchange rate similarly has effects only on the price level and other nominal magnitudes etc. The relevance of· these conclusions is generally admitted to be confined to the "long run". From the point of view of macroeconomic management, however, the essential question is not whether economic policies have effects in the long run, but rather whether they have "sufficiently fast" and "sufficiently enduring" effects (so that they affect demand and output during this year and next). This is clearly an empirical question. Seldom, however, are the models used to derive far-reaching policy conclusions confronted in anyway with empirical data. The aim of this study is to consider the significance of central bank policy (by which we mean monetary and exchange rate policy) for the cyclical behaviour of an economy with particular reference to Finland. The structure of the study is as follows. In Section 2 we specify a model of an open economy which is simple and yet includes variables reflecting the operation of exchange rate and monetary policy. The model forms the basis for a discussion of the characteristics of long-run equilibrium as well as of the significance of the monetary and exhange rate policy pursued for the short-run effects of various exogenous disturbances. At the end of Section 2, we also make some observations on the consequences of policy for the dynamics of adjustment. In Section 3 a partially condensed version of the model is estimated and used for simulation experiments that illustrate the quantitative significance of policy issues discussed in Section 2. Section 4 concludes.
  • Korkman, Sixten (1980)
    Suomen Pankki. B = Bank of Finland. B 33
    PREFACE 5 1. INTRODUCTION 7 1.1 Aim and Outline of the Study 10 2. DEVALUATION ANALYSIS: A SELECTIVE SURVEY 15 2.1 The Monetary General Equilibrium Approach 15 2.1.1 Assumptions 16 2.1.2 Exchange Devaluation 17 2.1.3 Exchange Stability 21 2.1.4 The Monetary Mechanism of Adjustment 22 2.1.5 Concluding Comments 24 2.2 Keynesian Devaluation Analysis 25 2.2.1 The Elasticities Approach 26 2.2.2 The Absorption Approach 28 2.2.3 The Standard Open Economy Model 29 2.2.4 Effects of a Devaluation: Unemployment 32 2.2.5 Effects of a Devaluation: Full Employment 36 2.2.6 Concluding Comments 39 3. INTERNAL AND EXTERNAL BALANCE 42 3.1 Tinbergen's Rule and Mundell's Principle 43 3.2 Meade on the Exchange Rate Regime 45 3.3 Mundell on the Exchange Rate Regime 49 3.4 The Assignment of Exchange Rate Policy 52 3.5 The Assignment Principle: An Extension 55 3.6 Concluding Comments 58 4. ANALYSIS OF EXCHANGE RATE POLICY IN A SIMPLE DYNAMIC MODEL 61 4.1 The Model 62 4.2 Short-run Comparative Statics 68 4.3 Dynamics 72 4.4 The Exchange Rate, Demand Management and Employment 77 4.5 Alternative Norms for Exchange Rate Policy 79 4.5.1 Fixed Exchange Rates 81 4.5.2 The Inflation Norm 82 4.5.3 The Competitiveness Norm 83 4.6 Concluding Comments 84 5. EXTERNAL BALANCE AND THE LONG RUN 87 5.1 The Concept of Structural Balance 88 5.1.1 Imbalance and Adjustment: Some Preliminary Observations 95 5.2 Accumulation and Intersectoral Allocation 99 5.2.1 Dynamic Investment Allocation: First Example 100 5.2.2 Dynamic Investment Allocation: Second Example 106 5.3 Devaluation and Accumulation 112 5.3.1 Effects of a Devaluation 112 5.3.2 The Devaluation Cycle 115 5.4 Conditions for Balanced Growth 119 5.5 Concluding Comment 122 6. SUMMARY, CONCLUSIONS AND SOME FINAL COMMENTS 124 REFERENCES 130
  • Korkman, Sixten; Tornberg, Pertti (1984)
    Bank of Finland. Monthly Bulletin 58 ; 6-7 ; June-July
  • Korkman, Sixten (1987)
    Bank of Finland. Monthly Bulletin 61 ; 5 ; May
  • Korkman, Sixten (1986)
    Bank of Finland. Monthly Bulletin 60 ; 5 ; May
  • Åkerholm, Johnny; Korkman, Sixten (1990)
    Bank of Finland Research Discussion Papers 23/1990
    1 artikeln analyseras Sveriges ekonomiska utveckling och balansproblem i jämförelse med en del andra länder, vilka valt en annorlunda växelkursregim eIler växelkurspolitik. Det konstateras, att devalveringspolitiken inte underlättat skötseln av balansproblemen och att det nu finns tydliga teeken på att de underliggande strukturella problemen skylts över. Framför allt finns ett stort behov av att skapa förtroende för en låginflationspolitik. Detta kräver i främsta hand kraftfulla ekonomisk-politiska åtgärder. Det kan dock hända att förtroendet kan återvinnas lättare, ifall ändringen av inriktningen i den ekonomiska politiken manifesteras genom en förändring i valutakursregimen. En styrning av valutakursen inom mycket snäva ramar kan dock skapa problem i framtiden. Den ekonomiska strukturen skiljer sig tilI väsentliga delar från strukturen i de flesta länder på kontinenten. Detta kan medföra att dessa ekonomier också i framtiden utsätts för annorlunda ekonomiska störningar än Sverige (och Finland).
  • Korkman, Sixten (1986)
    Bank of Finland. Monthly Bulletin 60 ; 4 ; April
  • Korkman, Sixten (1979)
    Keskustelualoitteita. Discussion Papers 3/1979
    I JOHDANTO II VIENTI III TUONTI II I.1 Koko tuonti III.2. Kulutustavaroiden tuonti 111.3. Investointitavaroiden tuonti III.4. Raaka-aineiden ja tuotantotarvikkeiden tuonti III.5. Yhteenveto tuontiyhtälöistä IV JOITAKIN ESIMERKKILASKELMIA ULKOMAANKAUPAN JA KOKONAISTUOTANNON SUHTEESTA IV.1. Kotimaisen kysynnän lisäyksen tuonti- ja tuotantovaikutuksista IV.2. Talouspolitiikan "ulkoisesta pelivarasta " ja "täystyöllisyysalijäämästä" IV.3. Hintamuutoksen substituutiovaikutuksista V JOHTOPÄÄTÖKSIÄ
  • Korkman, Sixten (1992)
    Bank of Finland. Bulletin 66 ; 6-7 ; June-July