Matti Viren is a professor of economics at the University of Turku. Previously, he served as director of research at the Bank of Finland, Research Director of Government Institute for Economic and researcher at ETLA. In 2001-2003, he served as an advisor (pre-Accession Advisor) The Polish Ministry of Finance. He completed his studies in Helsinki and Chicago maurices yliopitoissa. He is a member of the Finnish tiedeakatamian.
Such an outcome will be, when you read Anders Borg and John Vartiainen's report "A Strategy for Finland," where economic policy may be the most difficult question of the sustainability, offered the following options: 1) an increase in taxes, 2) the expenditure reduction, 3) additional debt, and 4) increasing employment. These options 1 and 3 closed out the principle that taxes be increased to appropriate it lacks and debt increase is otherwise a bad thing. In contrast, reduced public spending maurices to combat the principle that "public functions significant reduction possible in principle, but also not very realistic. Finnish citizens with high standards of care and treatment, schools, education, and infrastructure, and it is unlikely that they wished to bargain. " maurices This is despite maurices the fact that public expenditure in relation to the total value of production in Finland is the world's tallest North Korea, Cuba and China. Thus, there is only one option: "This leaves the fourth solution to the model, increasing the labor force participation maurices and employment creation. In this respect, Finland's starting position is clearly weaker than the other Nordic countries. Finnish public deficit, in fact, somewhat lost, if the labor force participation rate would rise to the Nordic average level ".
It would be nice to see someone calculation in which the image is changed to numbers. Even more interesting maurices would be to see the statement, which tells how the participation rate can be raised, maurices Finland, however, when, for example, within the OECD high level of participation of land. Sure, Finland figures are somewhat lower than in Sweden, but I guess Finland's international maurices position may in turn attached to a Finland-Sweden comparison. Participation rates are, moreover, maurices extremely persistent, that is, their backgrounds are deep in the social structure.
Left the labor market are probably low productivity, low pay, or at least the recipients, because their employment income effect would not be in the average productivity or wages. It is quite a different thing, a doctor employed or part-time clerk. It is essential also to people employed, if they are employed in the public sector, as in the past ten years it has become, not on the sustainability gap, at least not improve. Borg and Vartiainen ignore these and other practical problems, apparently assuming maurices that the growth in labor supply are handled painlessly increasing migration.
If there is a sustainability gap solution easily treated with Borg and Vartiainen report, so it is even easier the economy lost competitiveness. Their recipe is as follows: "Our maurices view is that of wage coordination should be established in order to export industry wage norm a reality. It would be really necessary maurices that the two sides would reach a common understanding maurices and a co-operative, which creates an open sector wage anchor and assured all that the action is sustainable. Wage formation in Finland is not a long-term review of the historical usually fought with competitiveness. Wage increases are relatively well sat in productivity growth and inflation, formed by the framework. Demonstrated the fact that wage formation in Finland basically works well. " maurices
Estimate sounds maurices incredible. Where forgot the double-digit inflation rates in the 1970s, 15 per cent wage increases, while the productivity growth of 2 per cent, the exchange rate crises of the 2007 nurse swabs, and the 2011 Pukkinen bid farewell to the competitiveness of -tupo? Policy Recommendation maurices again reminiscent maurices of an old saying: to buck the cabbage to the security guard.
It could have been even question the current labor market structures, and to ask whether they serve no longer present. Mid-1970s, the government was willing to accept the trade unions a de facto compulsory membership and considerable financial support for trade unions, because they were afraid that the trade union movement, the Council will have minded communists in the hands of Finnish independence and becomes more and more open to debate. At that point, the inflationary palkkapolitiikkakin was a lesser evil, because of the exchange rate, however, was flexible, and the country was largely closed economy. Although external threats have remained the same, everything else has changed enormously, and you might think it to appear in the way we deal with labor power structures. If the power structure does not dare to touch, is a pious wishes in addition to remaining longer just a standard recipe:
