In this paper we report the currently employed term structure estimation method in the Bank of Finland and we also discuss interpretation of the final results it produces. First we will introduce 2 extensively utilized term structure estimation methods: the Cubic Spline
The possible participation of Finland in the Stage III of the European Monetary Union would constitute a major change in the operating environment of the Finnish economy. As a member of the common currency area, Finnish interest and exchange rates would no longer be determined by domestic monetary policy or domestic financial market reactions, but would instead be given by the European Central Bank and the European financial markets.
Unemployment is now the key issue for economic policy in the OECD and Europe in particular. By examining data from the period 1962–1996 for two highly different small open OECD economies, Finland and New Zealand, in a VEC model this paper seeks
Two DSGE models are calibrated and simulated to investigate how the role of monetary policy differs between a closed and an open economy. The central bank conducts monetary policy according to a Taylor (1993) rule, reacting to inflation- and output deviations. Prices
In the beginning of 1990s Sweden implemented several measures in order to maintain price stability. These measures have resulted in an environment in which inflation is lower and more stable. The same development could be seen in other OECD countries. At the
Title: Determination of real exchange rate in China : a productivity approach There is increasing evidence that exchange rate movements depend upon a country’s productivity growth (or stage of development), and this effect is dubbed the Balassa-Samuelson theorem. This paper examines the