The paper analyses the sustainability of fiscal policy in the four largest countries of the EMU area and Finland with the aim of assessing whether current fiscal policies are compatible with the Stability and Growth Pact in the medium term.The sensitivity of the deficit and debt ratios to...

This paper investigates public pension funding using a dynamic general equilibrium macroeconomic model (DSGE) that facilitates investigation of distortionary effects of fiscal and pension policy responses to ageing. The model is calibrated to the Finnish economy, which will encounter substantial...

Using real time data from the OECD and fiscal policy reaction functions, this study explores euro area fiscal policies since the late 1990s. Both discretionary plans for the budget year and policy changes during budget implementation stages are investigated. The main focus is on the fiscal...

This paper examines the sources of output shocks in Finland as compared to other EU countries. The data consists of output fluctuations in main industries in nine current EU countries for the period 1978–1993. The sources of output shock are considered to consist of country-specific factors,...

This paper extends Gertler’s (1999) tractable overlapping generations model with life-cycle features by allowing for distortionary taxation, demographic transition and stochastic variation in demographic structure. The model is then used to study demographic change in the small open economy of...

The paper examines the role of bank relationships in business closures during the Finnish economic crisis of the early 1990s. We utilise a unique panel data set of 474 small and medium-sized firms, for which we have standard accounting information and for which we can in addition identify...

Keeping public finances on a sustainable foundation while the population ages is clearly a problem in Finland, as in many other western countries. The shrinking of the working-age population, ageing of the labour force, and growth in the number of very old persons form a difficult combination...