Three Assessments of Finland's Economic Crisis and Economic Policy
At the end of 1992, the idea to ask for an outside contribution to the public debate on economic policy in Finland was brought up at the Bank of Finland. The Bank of Finland contacted three internationally recognized professors of economics and invited them to present their detailed views on the causes of the current state of the Finnish economy and on the future outlook for the economy and economic policy. The Bank of Finland undertook to publish the professors' reports as received.
The Bank invited opinions from the following three experts:
Professor Christian Bordes, Universite de Bordeaux; Professor David Currie, London Business School; and Professor Hans Tson Söderström, Stockholm School of Economics and Center for Business and Policy Studies, Stockholm.
These experts were asked to give their views on the following issues:
What are the short- and long-term causes underlying the current state of the economy, including the role of economic policies?
What are the links between policies aiming at monetary stability and structural changes in the economy (employment and growth)?
Which economic policies, including monetary policies, would seem appropriate in the present situation and over the medium term?
The experts were asked to focus on broad economic developments and the relative roles of different economic policies in this context.
Immediately after having received the reports, the Bank of Finland published them on 29 June 1993, with only the summaries in Finnish. The reports are now published in two volumes, one in English and the other in Finnish. These reports deserve serious attention and critical assessment among economists and policy-makers. As they do not primarily deal with monetary policy but with the economy and economic policy as a whole, we hope that these reports will attract wide attention.
The project was coordinated at the Bank by Mr Heikki Koskenkylä, the Head of the Research Department. During their visits to Finland, the experts had several opportunities to meet Finnish economists representing various research institutes, universities, authorities and interest groups. In addition, the Bank of Finland supplied the foreign experts with information on the state of the economy and economic policy in Finland.
Helsinki, 16 August 1993
Matti Vanhala