Reviews

Abstract

Professor Hugo E. Pipping's work on the vicissitudes of the Bank of Finland (the central bank of the country) is one of the weightiest contributions that has yet been made to Finnish economic history. With the completion of volume lIt he has brought the story up to the beginning of World War I.     

The note issues of the bank of Sweden, 1668–1968

Abstract

Bank notes have a long history in Sweden. The first to have all the main characteristics of a bank note were issued in 1661 by Stockholms Banco. After the liquidation of that bank, caused by the over-issue of notes, the Riksbank in 1668 founded a new bank, Riksens Standers Bank (the Bank of the Estates of the Realm), now known as Sveriges Riksbank (the Bank of Sweden). This bank was initially prohibited by its statutes from issuing notes, but from the very year of its inception the public, against the will of the Bank, used certain papers intended for the internal operation of the Bank as substitute bank notes, and in 1701 the Bank introduced instruments of payment out of which bank notes proper subsequently developed.     

Efficiency and Risk in Commercial Banks – Hybrid DEA Estimation

Abstract

The hybrid DEA model can solve the difference between radial inputs and non-radial inputs and evaluate efficiency. This is a pioneering study that uses the hybrid DEA model, evaluating the proportionate inputs with a radial measure and the non-proportionate inputs with a non-radial measure, in order to examine the impact of non-performing loans (NPLs) on the efficiency of Taiwan's banking sector from 2006 to 2010. In summary, this research demonstrates the following: (1) Only nine banks remained in the top efficiency list during these years: China Development Industrial Bank, Mega International Commercial Bank, Chinatrust Commercial Bank, Cathay United Bank, Bank of Kaohsiung, Industrial Bank of Taiwan, Taiwan Cooperative Bank, Land Bank, and Bank of Taiwan. (2) Risk is an important factor that should be taken into consideration when evaluating banking efficiency. (3) From the hybrid DEA model, we find that most of the inefficient banks have an inefficiency factor caused primarily by too many NPLs (risk). (4) The efficiency of Taiwan's large-scale banks is significantly better than the small-scale bank. By looking at the inefficiency index, the large-scale bank's inefficiency is caused by NPLs. For the small-scale bank, both radial variables and non-radial variables have equal importance in improving its efficiency.     

Sweden's first bank-notes

Abstract

Sweden's first bank, Stockholms Banco, began to function in 1657. Its name is familiar among economic historians because it was the first bank in Europe to issue bank-notes in the modern sense of the word. It is exactly three hundred years since this issue began, and to celebrate the jubilee the Riksbank (Bank of Sweden) has published a work on the first Swedish bank-notes; its author IS Aleksandrs Platbārzdis of the Royal Coin Cabinet, Stockholm. The book is beautifully produced and richly illustrated.     

The way to industrialisation: A Finnish town history

Abstract

Scientific research on urban history in Finland dates from the end of the 19th century. The pioneer was Professor Carl von Bonsdorff, whose study of 17th century Turku (Åbo) is still a standard work in this field.¹ At the beginning of this century Professor Väinö Voionmaa added to the literature on the old pre-industrial towns his investigation of the rapid growth of Tampere (Tammerfors).² This city, ‘Finland's Manchester’, is a young industrial town; in order to survey its development before the beginning of the 20th century Voionmaa had to take a new quantitative approach. Since then Finnish research on urban history has grown to an extent that is quite out of proportion with the fact that urbanisation here is a late phenomenon. Historical studies now exist of practically every town, generally written by historians with professional training. In Finland historians have perhaps devoted themselves to a greater extent than elsewhere to research in local and thus also town history. The most ambitious attempt to produce a comprehensive history of a town from its foundation to the present is the history of Helsinki on which about ten historians are collaborating, six volumes of which have so far been published.³     

Peasant shipping as a profitable trade

Abstract

Finnish peasant shipping has so far only been discussed in books on local history and in a few rather brief specialised articles dealing with the earlier centuries. Consequently, Dr. Kaukiainen's academic dissertation, published in the spring of 1970, is virtually a pioneering study. He has chosen the period from the Swedish Russian War of 1808-09 to the Crimean War; this was fortunate because Finland was compelled by its new political alignment partly to re-route its shipping.     

Maritime trade and economic development in South Ostrobothnia

Abstract

Provincial history has been an object of lively interest in Finland during the last ten years or so. The majority of provinces are planning to have their histories written. Amongst these plans, that for South Ostrobothnia is the most advanced: four large volumes are now complete, covering the history of the region from prehistoric times down to 1809.     

The early sawmills industries in Finland

Abstract

The purpose of Dr. Nils Meinander's “Story of the Water-Driven Sawmill” in Finland is quite different from that of his Ph. D. thesis, published five years later. The former was written in celebration of the Finnish Sawmills Owners' Association's fiftieth anniversary and covers the whole field of the history of the early sawmills business in Finland. The latter gives a systematic and detailed account of the use of forest resources and of other problems connected with these industries in three river districts in the most northern part of Ostrobothnia.     

House Prices and the Stance of Monetary Policy: The Case of Korea

Abstract

This paper is an empirical investigation on whether the Bank of Korea should respond to the housing price developments in conducting monetary policy. For that aim, we construct a small scale empirical model of the Korean economy, simulate the estimated model with a set of alternative monetary policy rules, and compare the stabilization performances of those rules. There turns out to be ample room for further stabilization of inflation and output, if the central bank shifts from the historically conducted monetary policy rule to the optimal rule. The stabilization gains under the optimal rule, however, are not attributable to additional policy indicators (such as housing price inflation) the optimal rule involves. Rather, the optimal rule improves upon the historical one because the former takes a quite different reaction scheme toward the historical policy indicators. Moreover, as long as the Bank of Korea maintains appropriate reactions to the historical policy indicators, housing price inflation does not contain much extra information for further stabilization     

The Sacrifice Ratio and Central Bank Independence Revisited

Several recent studies make use of cross-country data to examine the relationship between a country's sacrifice ratio and the extent to which its central bank is insulated from political influence. These studies report a positive correlation between these two variables. However, these studies employ econometric methodologies that do not account for the measurement error which contaminates their proxies for central bank independence. This paper makes use of an alternative econometric methodology, one that does account for this measurement error, and finds a strong negative relationship between the sacrifice ratio and Central Bank independence.     

The introduction of the gold standard in Finland in 1877

Abstract

Dr. Björkqvist's voluminous dissertation covers a wide field. The problem of introducing the Gold Standard in Finland in 1877 was in the first place an economic one but negotiations with the Russian authorities also brought up, to a large extent, questions concerning the political relations between the then Grand Duchy of Finland and the Imperial Government of Russia. Dr. Björkqvist considers both these aspects and also approaches the problem from a third angle, the statistical one. He has compiled figures from various sources and turned them into handy time series. Viewed as a whole, however, the book must be classified as a study in economic history.     

A new account of Swedish society since 1668

Abstract

To mark the 300th anniversary of the foundation of the Swedish central bank (Riksbanken) it was decided to publish a broad survey of the development of Swedish society during the period the bank had been operating. Kurt Samuelsson (formerly Reader in economic history, now in sociology) was commissioned to write it and given a free hand. He chose to emphasize the economic, social and powerpolitical aspects of developments, which means that in essentials his perspective is that of the economic historian.     

Economic and ecologic determinants of household organisation in the Northeastern Baltic region

Abstract

The aim of this article is to contest the monocausal cultural explanation model for the existence of the eastern Finnish family system linked to an imaginary Hajnal line. By comparing two localities in the eastern part of Finland with common religion, language, political history and legislation but with different ecology and economy and household system, a case is made for the link between economic activity and household organisation.     

Earldoms and baronies as economic enterprises in seventeenth century Finland

Abstract

In his comprehensive monograph of nearly eight hundred pages, the first volume of which was published as an academic dissertation six years ago, Professor Jokipii has undertaken to give an account of the brief history of Finnish earldoms and baronies. With two exceptions these twenty-nine large-scale fiefs lasted in all only a quarter of a century (the third quarter of the seventeenth century). Nevertheless, they made their mark on the later development of Finland.     

From growth studies to microhistory: Finnish economic and social history in the 1990s and early 2000s

Abstract

Economic and social history was already being practised in Finland before the Second World War, although it became established as an independent academic discipline only after the war. The terms social history or economic history were not used then; what we now recognise for instance as social history was then called “cultural history” or “history of the culture”. This approach was often characterised the collective approach to distinguish it from the individualistic approach of more historicist study. Nearly all economics research was historical before the 1950s, and practically all professors of economics were actually historians by training and had defended their dissertations in history, usually after having studied some economic problem of the past. But our discipline has also other roots. In Finnish universities the discipline called social policy, usually included in faculties of social science, has always had strong ties with social history.     

The finnish glass industry

Abstract

In 1948 the Finnish glass industry celebrated the 200th anniversary of its first permanent establishment. Although Finland's first glassworks was built as early as 1681, in Uusikaupunki (Nystad), it was burnt down immediately afterwards and all memory of its existence had disappeared when new plans to build a glassworks were put in hand. This enterprise was the Avik glassworks, erected in 1748, and the pioneer plant in Finland. To mark this anniversary, Prof. Annala has published a two-volume history of the industry during the period of Russian rule (18090–1917). These two volumes form the second part of a larger work, the first part of which, covering the period of Swedish rule, was published in 1931, to mark the 250th anniversary of the Uusikaupunki factory. The recent war and the evacuation of the archives account for the long delay in the completion of the work.     

Bank Rate policy in Norway, 1893–1914

Abstract

The article discusses Bank Rate policy in Norway in the last two decades of the classical gold standard. The empirical mainstay is a detailed examination of rate changes. The key finding is that Bank Rate changes not were decided in accordance with a single monetary rule or criterion, but were influenced by a broader set of considerations. In particular, Norges Bank was sensitive to the needs of business and the state of domestic money market.     

The transatlantic tar trade

Abstract

The tar trade has been of especial interest to Finnish commercial history, as tar has been regarded as Finland's main export article in the seventeenth and eighteenth centuries.¹ However, the studies of Professor Aulis J. Alanen suggest that this was no longer the case during the final phase of the Swedish regime, when the boom in shipbuilding for export, the new sawmill industry and the rising incomes from freights reduced the share of tar exports in the balance of payments. The significance of tar production and the tar trade was nevertheless fairly considerable for a long time in Northern Finland.     

Worldwide Inflation and International Monetary Reform： Exchange Rates or Interest Rates？

The international dollar standard is malfunctioning. Near‐zero US short‐term interest rates launch massive hot money outflows into emerging markets (EM) in Asia and Latin America. Each EM central bank buys dollars to prevent its currency from appreciating but loses monetary control. Despite some appreciation, average inflation in EMs is now much higher than in the old industrial economies and world commodity prices are bid up sharply. This inflation on the dollar's periphery only registers in the US CPI with a long lag. However, the more immediate effect of the Fed's zero interest rate is to upset the process of bank intermediation within the American economy. Bank credit continues to decline while employment languishes. Therefore, constructive international monetary reform calls for the Fed to abandon its zero‐interest rate policy, which is best done in cooperation with the European Central Bank, the Bank of Japan, and the Bank of England also abandoning their ultra low interest rates.