The purpose of this paper is to find a suitable method for estimating output gaps and calculating the cyclically adjusted government budget balance for Finland.Several different approaches for estimating a reference trend are briefly evaluated and a calculation of the cyclically adjusted...

This paper considers different indicators of inflation that are recorded in Finland.Initially, we define inflation as an irreversible rise in the general price level.We then go on to describe different indicators of inflation, focusing on problems related to their construction.Since it is not...

The possibilities to improve households' eligibility for long-term housing loans at fixed interest rates has been a current topic of public discussion.Yet, credit institutions have difficulties in granting such loans, unless they themselves can acquire fixed-rate funding.In many cases, the only...

This report describes the determination of private consumption and investment in the BOF4 model. The consumption function of the model is largely based on thepermanent income hypothesis. Relative prices and the level of aggregate consumption determine the shares of the three consumption...

This paper describes the structure and simulation properties of the Bank of Finland's macroeconometric model BOF4. BOF4 is a quarterly, medium-sized macro model of the Finnish economy, consisting of about 70 behavioural equations. Including accounting identities and technical linkages of...

This report is the basic documentation of the present (fifth) version of the Bank of Finland macroeconomic model, BOF5, built for policy simulation and forecasting.In constructing the model, consistent treatment of expectations is emphasized.Following current theoretical literature,...