The Finns reasonably competitive best food scale salaries | Roger Wessman
Everyone knows that the Finnish economy is a significant best food scale competitive problem. However, some dissenting voices heard. From experience I know that this issue is not worth to disagree, unless you want to feel angry comments. Still, I'm not yet convinced: Finland's best food scale economic problems appear to be more reflective of international counter-cyclical as particularly weak competitiveness of Finnish.
Competitiveness can be measured in many ways, and I do not leave right now to argue about which meter is right. I'm going for a simpler premise. Competitiveness The problem is reflected in the way our export succeeds. As the English say: The proof of the pudding is in the eating:
There are certainly many examples of the fact that the Finnish producers are no longer competitive. In particular, the industry is clearly a problem. On the other hand the service exports have grown at the same time so that by examining only the development of the industry gets too gloomy picture of the situation.
How much, then we should take in order to be satisfied? Export is not an end in itself, but we need export earnings to cover import costs and other financial flows destined abroad. According to this, we have a lot of enough export if the current account is in balance.
This is not however a sufficient answer. The current account balance can be kept even if the export is poor by reducing best food scale domestic demand and thus imports the balance. This can be seen when the economic stagnation and rising unemployment. Precisely this has happened in the last couple of years: Finland's current account deficit has declined while unemployment has increased.
Now we have a situation in which the current account is broadly balanced, but unemployment is clearly too high. Unemployment in itself is therefore a sign that competitiveness should improve.
However, best food scale the high unemployment rate does not necessarily reflect the competitiveness problem, but may also reflect the international economic cycle. It is difficult to interpret the sign of Finland's competitiveness problem, while elsewhere in the euro area, unemployment is on average briskly higher in high unemployment.
Sure, such as Germany has shown, in low economic conditions of full employment can be achieved if competitiveness is briskly better best food scale than average. However, we all can have a better average. Improving best food scale competitiveness by cutting wages is a zero-sum game, where unemployment best food scale only be transferred to another country. If all euro countries best food scale would try to imitate Germany best food scale would result in only a deepening deflationary spiral. If and when the eurozone recovers from the recession in Germany, in turn, now looming shortage of employment and the consequent upward pressure on wages.
Is the unemployment rate is currently no longer a good indicator? How about a private sector (real) wages and salaries divided by the number of working age people? This does not mean that the public work does not create value, but that the private sector wage bill could be suitably eligible, revised edition competitiveness indicator. best food scale The public best food scale sector share of hours worked guess I should somehow be taken into account if it has not been relatively constant? What do you think of such indicators and be able to present a graph of this national measure of our competitiveness if you keep it sensible?
Finland's kind of a double issue of the ECB as a result of the monetary policy. Tosaalta throughout the euro area suffering in its, but it is also the exchange rate problem. The ECB because of the outrageously tight rahapoitiikan the euro is Finland's point of view too expensive. I looked at some time ago a matter of urgency how exchange rates have changed since the financial crisis. The euro has strengthened best food scale the dollar against best food scale more than SEK after the crisis. Not a good sign.
REER looks from beyond: http://epp.eurostat.ec.europa.eu/tgm/graphCreator.do?tab=graph&a=2&cp=noValue&c=1&d=0&i=DE&h=0&time=0-18&x=time&geo=2,7,28-29&y=geo&f=90.0&g=130.0&language=en&pcode=tsdec330&plugin=1
It seems that we are too expensive. Fortunately, we can take plenty of additional debt, so no need to devalue internally as the euro area is a habit. We expect only that the euro kosahtaa or other bored and put the ECB's press money.
Finland's best food scale real exchange rate is of course clearly higher than in other euro area countries' 90s mid, such as linking you to the illustration. However, I am here to withdraw its conclusion that the real exchange rate would now be too high. After the markka float the real exchange rate was rather low. We organization joined the euro once the undervalued exchange rate. This haircut is now resolved faster than wage costs rise in Finland.
A small reminder is in place when you say that, "Fortunately, we can take plenty of additional debt, so no need to devalue internally as the euro area has a habit". The state of course, take on debt, but if we look at the entire Finnish national economy as a whole, em
Everyone knows that the Finnish economy is a significant best food scale competitive problem. However, some dissenting voices heard. From experience I know that this issue is not worth to disagree, unless you want to feel angry comments. Still, I'm not yet convinced: Finland's best food scale economic problems appear to be more reflective of international counter-cyclical as particularly weak competitiveness of Finnish.
Competitiveness can be measured in many ways, and I do not leave right now to argue about which meter is right. I'm going for a simpler premise. Competitiveness The problem is reflected in the way our export succeeds. As the English say: The proof of the pudding is in the eating:
There are certainly many examples of the fact that the Finnish producers are no longer competitive. In particular, the industry is clearly a problem. On the other hand the service exports have grown at the same time so that by examining only the development of the industry gets too gloomy picture of the situation.
How much, then we should take in order to be satisfied? Export is not an end in itself, but we need export earnings to cover import costs and other financial flows destined abroad. According to this, we have a lot of enough export if the current account is in balance.
This is not however a sufficient answer. The current account balance can be kept even if the export is poor by reducing best food scale domestic demand and thus imports the balance. This can be seen when the economic stagnation and rising unemployment. Precisely this has happened in the last couple of years: Finland's current account deficit has declined while unemployment has increased.
Now we have a situation in which the current account is broadly balanced, but unemployment is clearly too high. Unemployment in itself is therefore a sign that competitiveness should improve.
However, best food scale the high unemployment rate does not necessarily reflect the competitiveness problem, but may also reflect the international economic cycle. It is difficult to interpret the sign of Finland's competitiveness problem, while elsewhere in the euro area, unemployment is on average briskly higher in high unemployment.
Sure, such as Germany has shown, in low economic conditions of full employment can be achieved if competitiveness is briskly better best food scale than average. However, we all can have a better average. Improving best food scale competitiveness by cutting wages is a zero-sum game, where unemployment best food scale only be transferred to another country. If all euro countries best food scale would try to imitate Germany best food scale would result in only a deepening deflationary spiral. If and when the eurozone recovers from the recession in Germany, in turn, now looming shortage of employment and the consequent upward pressure on wages.
Is the unemployment rate is currently no longer a good indicator? How about a private sector (real) wages and salaries divided by the number of working age people? This does not mean that the public work does not create value, but that the private sector wage bill could be suitably eligible, revised edition competitiveness indicator. best food scale The public best food scale sector share of hours worked guess I should somehow be taken into account if it has not been relatively constant? What do you think of such indicators and be able to present a graph of this national measure of our competitiveness if you keep it sensible?
Finland's kind of a double issue of the ECB as a result of the monetary policy. Tosaalta throughout the euro area suffering in its, but it is also the exchange rate problem. The ECB because of the outrageously tight rahapoitiikan the euro is Finland's point of view too expensive. I looked at some time ago a matter of urgency how exchange rates have changed since the financial crisis. The euro has strengthened best food scale the dollar against best food scale more than SEK after the crisis. Not a good sign.
REER looks from beyond: http://epp.eurostat.ec.europa.eu/tgm/graphCreator.do?tab=graph&a=2&cp=noValue&c=1&d=0&i=DE&h=0&time=0-18&x=time&geo=2,7,28-29&y=geo&f=90.0&g=130.0&language=en&pcode=tsdec330&plugin=1
It seems that we are too expensive. Fortunately, we can take plenty of additional debt, so no need to devalue internally as the euro area is a habit. We expect only that the euro kosahtaa or other bored and put the ECB's press money.
Finland's best food scale real exchange rate is of course clearly higher than in other euro area countries' 90s mid, such as linking you to the illustration. However, I am here to withdraw its conclusion that the real exchange rate would now be too high. After the markka float the real exchange rate was rather low. We organization joined the euro once the undervalued exchange rate. This haircut is now resolved faster than wage costs rise in Finland.
A small reminder is in place when you say that, "Fortunately, we can take plenty of additional debt, so no need to devalue internally as the euro area has a habit". The state of course, take on debt, but if we look at the entire Finnish national economy as a whole, em
No comments:
Post a Comment