Using information from a variety of sources, including our own estimates from quarterly data for each of the countries over the period 1972–1997, this paper suggests that the exchange rate will play an important role in the transmission of the impact of monetary policy through to the real...

This paper provides an answer to the question of how to improve the forecasting performance of a macro model to better account for economic developments and how to evaluate the forecasting uncertainty. The main tool in this assessment is stochastic simulation. Stochastic simulations in this...

We model banks’ loan losses with a panel of European countries for the period 1982–2012 using three country-specific macro variables: output growth shocks, real interest rates, and a measure of excessive private sector indebtedness. We find that a drop in output has an intensified impact on...

We investigate the relationship between the daily average interbank overnight borrowing rate (AOR) and the credit default swap price (CDS) of 60 banks using the Eurosystem’s proprietary data from mid-2008 to mid-2013. We find that the AOR which is observable only by the competent Eurosystem...

This paper deals with the problems of assessing the effects of fiscal policy in the European Monetary Union. Here, we face wide cross-country differences in key fiscal parameters, some of which may also be vary over time (business cycle). Moreover, these effects may also depend on trade...

This paper deals with the incidence of housing subsidies, which is analysed using Finnish panel data. The main data set comprises 50 000 households that received housing allowances during the period 2000–2008. In addition, we utilize repeated cross-sections of all Finnish households for...

This paper studies forecasts errors at the micro level using two alternative survey data sets. The main focus is on inflation and real GDP growth forecasts in the ECB Survey of Professional Forecasters. For comparison, inflation forecasts in the US Survey of Professional Forecasters are also...

This paper deals with economic growth in Europe. The special emphasis is in key institutional factors that are commonly assumed to affect aggregate growth: functioning of labor markets, availability of labor and capital, and the size of government. For more explicit measures, we use the data on...

This paper explores the determinants of aggregate economic fluctuations in Finland. The analysis makes use of aggregate monthly time series for some financial and non-financial variables covering the period 1922–1990. In particular, we scrutinize the role of bankruptcies in the propagation...

This paper deals with Finnish bankruptcies. It shows that bankruptcies are strongly related to the business cycle and that they are perhaps even more strongly related to indebtedness, real interest rates and asset prices. The importance of these financial factors probably increased when the...