Finnish food industry in 1989-2002: an output-oriented input-output analysis

Ten years in the EU (European Union) have passed and structural changes have taken place in the food sector, but it is a common opinion that as far as production is concerned the food sector has managed better than expected. In this paper, we study structural changes in the Finnish food industry in 1989-2002, with the focus on the use of domestic and imported inputs and value-added formation before and after joining the EU. An input-output (I-O) analysis output approach will be applied, as this enables to trace the multiplier effects of an industry's total output. The results confirm an increase in imported inputs as well as in demand of the domestic service industries; and conversely, a decrease in the food industry's (own) value added. It is concluded that outsourcing, labour reduction and increased imports have improved the efficiency of the Finnish food industry and contributed to its stable development after accession to the EU.     

Regulation and Public Sector Development: A Post-Transition Perspective

The article is devoted to the changing role of the major public policy function of regulation and the changing role of the public sector in various phases of systemic change in central and eastern Europe. It surveys the consequences of bloodletting for the civil service and state capactiy in a world increasingly dominated by delocalisation and dematerialisation. Meanwhile a large part of the economy is unlikely to be transformed into purely asset value maximising units, thus the importance of regulating the intermediate forms of activity between public and private firms is going to gain in importance. Limitations of the current EU model, based on traditions rather than attending tasks of the future are highlighted in both the administrative and the enonomic spheres.     

Workperformance,interests, powers and environment: The case of cyclical slowdowns in a Hungarian factory

Sociologists and psychologists, and economists have tended to stress different causes of fluctuations in productivity: the first have emphasized non-economic factors, the second, stressed imperfections of the incentive system. The article tests these views on the basis of a close investigation of production and labour relations in a factory of the Hungarian railway equipment industry.     

Covered interest parity with default risk

In this paper we derive a simple model of covered interest parity (CIP) with the assumption that interbank money market rates are risky. The model assumes that the default risk of uncollateralised loans can be hedged perfectly by credit default swap contracts. We show that the no-arbitrage condition is satisfied by a band. The location of this no-arbitrage band depends on the relative riskiness of the two counterparties in the CIP trade. We present evidence on the performance of the model for developed currency pairs in 2008–2011. We find that FX swap spreads (CIP deviations calculated from interbank interest rates of two countries) either fluctuated within the no-arbitrage bands or were close to the edges of the no-arbitrage bands.