The paper is concerned with the history of the Finnish incomes policy, covering the period from the Second World War to the present. It deals with the Finnish incomes policy as a special type of political exchange between the social partners and the Government. In pursuing wage moderation, governments have used welfare reforms as a means of exchange for solving certain externalities arising in wage bargaining. The continuity of political exchange between the social partners and the Government requires a common ground of values and trust. In the paper, these prerequisites are characterised by the use of the concept of social capital. Social capital can be interpreted as a relationship of horizontal trust between the social partners and the Government. This interpretation is closely related to Bo Rothstein’s concept of organised social capital. Accordingly, the paper emphasises the importance of the institutional framework within which incomes policy negotiations have been carried out as an important promoter of social capital between the social partners and the Government. The paper also emphasises the importance of centrally negotiated incomes policy agreements as an important institutional framework within which the Finnish welfare state has evolved. For example, the earnings-related pension scheme has been developed mostly within the framework. The paper discusses not only the history but also the present and the future of the Finnish incomes policy. Owing to the traditionally close relationship between centrally negotiated incomes policy agreements and welfare reforms, the end of centrally negotiated incomes policy agreements declared by one of the social partners, the Confederation of Finnish Industries, is likely to affect not only the manner in which wages are negotiated in the future but also the tradition of political exchange between the social partners and the Government. The end of centrally negotiated incomes policy agreements may put an end to political exchange, too. Furthermore, it may give rise to a deterioration of social capital between the social partners.
This document discusses the debate around fiscal integration within the European Union and Eurozone. It argues that while some level of fiscal integration may help support monetary integration, the relationship is complex and not all proposals for closer fiscal integration are necessarily beneficial. The document outlines different definitions and components of a fiscal union. It also examines the interlinkages between monetary and fiscal unions from both a theoretical and empirical perspective, finding the evidence mixed. Overall the paper aims to provide a more nuanced analysis of fiscal integration options within the EU/Eurozone.
Succession process among africa owned business europe 1John Johari
This document discusses family businesses and succession problems. It begins by establishing that family businesses make up a significant portion (70-80%) of businesses in Europe and employ 40-50% of the workforce. One of the major problems family businesses face is transferring ownership and management to the next generation, and only 30% of businesses survive to the second generation due to unsolved succession issues. The document then provides context on family businesses in the EU and former socialist countries like Slovenia, where they have emerged as an important part of the economy since the transition in the 1990s. It establishes that succession planning is a crucial issue for family businesses that requires supportive infrastructure and policies.
Tutkimuksessa tarkastellaan työehtosopimuksissa määräytyvien alimpien taulukkopalkkojen vaikutuksia palkkajakaumaan ja työllisyyteen vähittäiskaupan alalla. Aineistona käytetään EK:n yksityisten palvelualojen palkka-aineistoa vuosilta 1990–2005. Tähän aineistoon on liitetty työehtosopimuksiin perustuvat kaupan alan vähimmäispalkat. Tutkimuksessa käytetään hyväksi erityisesti niitä poikkeuksia, joita vähimmäispalkkoihin sovittiin työmarkkinaosapuolten kesken 1990-luvun puolivälissä. Vuosina 1993–1995 oli mahdollista maksaa työehtosopimuksessa sovittua taulukkopalkkaa matalampaa palkkaa alle 25-vuotiaille nuorille. Tulosten perusteella nuoria koskevilla poikkeuksilla ei ollut vaikutuksia työllisyyteen, vaikka niillä olikin jonkin verran vaikutuksia todellisuudessa maksettuihin palkkoihin erityisesti palkkajakauman alapäässä.
The recent focus on impact evaluation within development economics has lead to increased pressure on aid agencies to provide "hard evidence", i.e. results from randomized controlled trials (RCTs), to motivate how they spend their money. In this paper I argue that even though RCTs can help us better understand if some interventions work or not, it can also reinforce an existing bias towards focusing on what generates quick, immediately verifiable and media-packaged results, at the expense of more long term and complex processes of learning and institutional development. This bias comes from a combination of public ignorance, simplistic media coverage and the temptation of politicians to play to the simplistic to gain political points and mitigate the risks of bad publicity. I formalize this idea in a simple principal-agent model with a government and an aid agency. The agency has two instruments to improve immediately verifiable outcomes; choose to spend more of the resources on operations rather than learning or select better projects/programs. I first show that if the government cares about long term development, then incentives will be moderated not to push the agency to neglect learning. If the government is impatient, though, then the optimal contract leads to stronger incentives, positively affecting the quality of projects/programs but also negatively affecting the allocation of resources across operations and learning. Finally, I show that in the presence of an impatient government, then the introduction of a better instrument for impact evaluation, such as RCTs, may actually decrease aid effectiveness by motivating the government to chose even stronger incentives.
The paper discusses the role of the state in shaping an economic system which is, in line with the welfare economics approach, capable of performing socially important functions and achieving socially desirable results. We describe this system through a set of indexes: the IHDI, the World Happiness Index, and the Satisfaction of Life index. The characteris-tics of the state are analyzed using a set of variables which describe both the quantitative (government size, various types of governmental expenditures, and regulatory burden) and qualitative (institutional setup and property rights protection) aspects of its functioning. The study examines the “old” and “new” member states of the European Union, the post-communist countries of Eastern Europe and Asia, and the economies of Latin America. The main conclusion of the research is that the institutional quality of the state seems to be the most important for creation of a socially effective economic system, while the level of state interventionism plays, at most, a secondary and often negligible role. Geographical differentiation is also discovered, as well as the lack of a direct correlation between the characteristics of an economic system and the subjective feeling of well-being. These re-sults may corroborate the neo-institutionalist hypothesis that noneconomic factors, such as historical, institutional, cultural, and even genetic factors, may play an important role in making the economic system capable to perform its tasks; this remains an area for future research.
This report is designed to help social entrepreneurs benchmark their organisation against fellow social enterprises in Sweden. We hope the report can help social enterprises to better place their organisation (e.g. what makes it distinct; readily spot differences and similarities with their peers). The report will also be useful for support organisations and policy makers to obtain an overview of social enterprises in Sweden. If this report can be put to any other good uses, we would be most delighted. Of course a rich database like ours contains many more insights and policy implications, which will soon be published on www.seforis.eu.
Top salaries in the Ontario public sector have increased substantially in real terms since 1996, similar to increases in top salaries across the Ontario economy. With the exception of school boards, top public sector salaries rose at approximately the same rate as overall top salaries in Ontario. The increases in public sector salaries were much smoother over time compared to the private sector, suggesting some insulation from private labor market forces in the short-run. Disclosure of public sector salaries does not appear to have restrained growth in top salaries. Reduced top income tax rates may have improved bargaining positions for high-earning employees and contributed to rising incomes.
After the Economic Crisis in early 1990s the Finnish economy has recovered rapidly, and simultaneously a major period of equalization from the mid 1970s to the mid 1990s has been reversed, taking the levels of the Gini coefficient in a few years back to levels of inequality found 30 years ago. The paper examines how changes in Government policy, and in particular, in the incentives introduced by tax reforms have influenced income inequality. The paper introduces a decomposition of the Gini and concentration coefficients by population groups which are calculated for before and after-tax incomes to consider evolution of income inequality and tax progressivity in Finland over the period 1990–2004. Decompositions of the Gini coefficient of after-tax income by income sources give little information on the effects of taxation. In contrast, popular measures of tax progressivity (Reynolds and Smolensky 1977) show a significant decrease. Our decomposition of the progressivity measure by income deciles focuses on changes in tax treatment of the income deciles in the ten year period after the mid 1990s. The changes in the decile shares of beforetax and after-tax income among those in the highest before-tax income deciles are the main factors that lie behind the recent change in tax progressivity, and play an important role in explaining the recent surge in inequality. These changes have been accompanied with a change in the composition of factor income. There has been an unprecedented increase in capital income which has mainly accrued to the population groups at the high end of the income distribution after the mid 1990s. The change is most clearly seen among those in the top income percentage. The 1993 Finnish tax reform introducing the Nordic dual income tax model, and creating strong incentives to shift labour income to capital income for those in the highest marginal tax brackets, is among the key policy decisions responsible for this trend. Interestingly enough, but consistent with the income shifting hypothesis, we find no increase in horizontal inequality in response to the introduction of the dual income tax.
This document discusses the debate around fiscal integration within the European Union and Eurozone. It argues that while some level of fiscal integration may help support monetary integration, the relationship is complex and not all proposals for closer fiscal integration are necessarily beneficial. The document outlines different definitions and components of a fiscal union. It also examines the interlinkages between monetary and fiscal unions from both a theoretical and empirical perspective, finding the evidence mixed. Overall the paper aims to provide a more nuanced analysis of fiscal integration options within the EU/Eurozone.
Succession process among africa owned business europe 1John Johari
This document discusses family businesses and succession problems. It begins by establishing that family businesses make up a significant portion (70-80%) of businesses in Europe and employ 40-50% of the workforce. One of the major problems family businesses face is transferring ownership and management to the next generation, and only 30% of businesses survive to the second generation due to unsolved succession issues. The document then provides context on family businesses in the EU and former socialist countries like Slovenia, where they have emerged as an important part of the economy since the transition in the 1990s. It establishes that succession planning is a crucial issue for family businesses that requires supportive infrastructure and policies.
Tutkimuksessa tarkastellaan työehtosopimuksissa määräytyvien alimpien taulukkopalkkojen vaikutuksia palkkajakaumaan ja työllisyyteen vähittäiskaupan alalla. Aineistona käytetään EK:n yksityisten palvelualojen palkka-aineistoa vuosilta 1990–2005. Tähän aineistoon on liitetty työehtosopimuksiin perustuvat kaupan alan vähimmäispalkat. Tutkimuksessa käytetään hyväksi erityisesti niitä poikkeuksia, joita vähimmäispalkkoihin sovittiin työmarkkinaosapuolten kesken 1990-luvun puolivälissä. Vuosina 1993–1995 oli mahdollista maksaa työehtosopimuksessa sovittua taulukkopalkkaa matalampaa palkkaa alle 25-vuotiaille nuorille. Tulosten perusteella nuoria koskevilla poikkeuksilla ei ollut vaikutuksia työllisyyteen, vaikka niillä olikin jonkin verran vaikutuksia todellisuudessa maksettuihin palkkoihin erityisesti palkkajakauman alapäässä.
The recent focus on impact evaluation within development economics has lead to increased pressure on aid agencies to provide "hard evidence", i.e. results from randomized controlled trials (RCTs), to motivate how they spend their money. In this paper I argue that even though RCTs can help us better understand if some interventions work or not, it can also reinforce an existing bias towards focusing on what generates quick, immediately verifiable and media-packaged results, at the expense of more long term and complex processes of learning and institutional development. This bias comes from a combination of public ignorance, simplistic media coverage and the temptation of politicians to play to the simplistic to gain political points and mitigate the risks of bad publicity. I formalize this idea in a simple principal-agent model with a government and an aid agency. The agency has two instruments to improve immediately verifiable outcomes; choose to spend more of the resources on operations rather than learning or select better projects/programs. I first show that if the government cares about long term development, then incentives will be moderated not to push the agency to neglect learning. If the government is impatient, though, then the optimal contract leads to stronger incentives, positively affecting the quality of projects/programs but also negatively affecting the allocation of resources across operations and learning. Finally, I show that in the presence of an impatient government, then the introduction of a better instrument for impact evaluation, such as RCTs, may actually decrease aid effectiveness by motivating the government to chose even stronger incentives.
The paper discusses the role of the state in shaping an economic system which is, in line with the welfare economics approach, capable of performing socially important functions and achieving socially desirable results. We describe this system through a set of indexes: the IHDI, the World Happiness Index, and the Satisfaction of Life index. The characteris-tics of the state are analyzed using a set of variables which describe both the quantitative (government size, various types of governmental expenditures, and regulatory burden) and qualitative (institutional setup and property rights protection) aspects of its functioning. The study examines the “old” and “new” member states of the European Union, the post-communist countries of Eastern Europe and Asia, and the economies of Latin America. The main conclusion of the research is that the institutional quality of the state seems to be the most important for creation of a socially effective economic system, while the level of state interventionism plays, at most, a secondary and often negligible role. Geographical differentiation is also discovered, as well as the lack of a direct correlation between the characteristics of an economic system and the subjective feeling of well-being. These re-sults may corroborate the neo-institutionalist hypothesis that noneconomic factors, such as historical, institutional, cultural, and even genetic factors, may play an important role in making the economic system capable to perform its tasks; this remains an area for future research.
This report is designed to help social entrepreneurs benchmark their organisation against fellow social enterprises in Sweden. We hope the report can help social enterprises to better place their organisation (e.g. what makes it distinct; readily spot differences and similarities with their peers). The report will also be useful for support organisations and policy makers to obtain an overview of social enterprises in Sweden. If this report can be put to any other good uses, we would be most delighted. Of course a rich database like ours contains many more insights and policy implications, which will soon be published on www.seforis.eu.
Top salaries in the Ontario public sector have increased substantially in real terms since 1996, similar to increases in top salaries across the Ontario economy. With the exception of school boards, top public sector salaries rose at approximately the same rate as overall top salaries in Ontario. The increases in public sector salaries were much smoother over time compared to the private sector, suggesting some insulation from private labor market forces in the short-run. Disclosure of public sector salaries does not appear to have restrained growth in top salaries. Reduced top income tax rates may have improved bargaining positions for high-earning employees and contributed to rising incomes.
After the Economic Crisis in early 1990s the Finnish economy has recovered rapidly, and simultaneously a major period of equalization from the mid 1970s to the mid 1990s has been reversed, taking the levels of the Gini coefficient in a few years back to levels of inequality found 30 years ago. The paper examines how changes in Government policy, and in particular, in the incentives introduced by tax reforms have influenced income inequality. The paper introduces a decomposition of the Gini and concentration coefficients by population groups which are calculated for before and after-tax incomes to consider evolution of income inequality and tax progressivity in Finland over the period 1990–2004. Decompositions of the Gini coefficient of after-tax income by income sources give little information on the effects of taxation. In contrast, popular measures of tax progressivity (Reynolds and Smolensky 1977) show a significant decrease. Our decomposition of the progressivity measure by income deciles focuses on changes in tax treatment of the income deciles in the ten year period after the mid 1990s. The changes in the decile shares of beforetax and after-tax income among those in the highest before-tax income deciles are the main factors that lie behind the recent change in tax progressivity, and play an important role in explaining the recent surge in inequality. These changes have been accompanied with a change in the composition of factor income. There has been an unprecedented increase in capital income which has mainly accrued to the population groups at the high end of the income distribution after the mid 1990s. The change is most clearly seen among those in the top income percentage. The 1993 Finnish tax reform introducing the Nordic dual income tax model, and creating strong incentives to shift labour income to capital income for those in the highest marginal tax brackets, is among the key policy decisions responsible for this trend. Interestingly enough, but consistent with the income shifting hypothesis, we find no increase in horizontal inequality in response to the introduction of the dual income tax.
The study by Eero Lehto, Petri Kuoppamäki, Matti Kari and Ilkka Kiema considers some widely used customer loyalty programmes in Finland and Sweden. In particular, the study analyses these arrangements in retail trade and financial markets. With easier tracking of customers, the benefits of concentration in retail trade as well as in insurance and banking operations have increased in Finland and elsewhere in Europe. Generally speaking, these customer loyalty programmes reward customers for concentrating their purchases to a company that offers benefits. The nature of the programmes differs, depending on whether the bonus is given in cash or as a discount on the company's products. From the viewpoint of consumers and competition, even more important is whether a potential discount is given for the same type of products or other types of goods entirely.
As is the consumers’ welfare is the main concern of competition and consumer law, this study evaluates the impact of customer loyalty programmes mainly by focusing on pricing and consumer surplus. We have also studied the effects of bundling with companies and consumers by means of theoretical models.
The problem of Finnish customer loyalty programmes with regard to competition and consumers is that they have, in many places, been extended to include several industries at a time. Limiting bonus programmes to only one 2-digit level industry could have a positive impact on competition and consumers. Another problem is the long duration of some benefits. Reducing the bonus accrual period to two years at least in the banking and insurance sectors would have healthy effects on competition. It would also be in the interest of consumers.
An international comparison suggests that the share of private services in terms of output and employment is rather low in Finland. This feature raises several interesting questions.
What explains this particular feature of the Finnish production structure? How has the great depression of the early 1990s influenced the structure of private services in Finland? What kind of policy measures could be implemented in order to increase the share of private services from a long-run perspective? Finnish service employment also contains a number of other interesting particularities in an international comparison.
Within a corporatist framework, these include a rather large public sector employer, high
female participation rate, but on the other hand a low share of part-time work.
This paper reviews the literature on optimal taxation of labour income and the empirical work on labour supply and the elasticity of taxable income in Sweden. It also presents an overview of Swedish taxation of labour income, offers calculations on the development in effective marginal tax rates and participation tax rates, and estimates, using the difference-indifferences method, the impact of tax incentives on employment rates of elderly workers. After this background, we ponder possibilities for reforming the Swedish tax system to
improve its labour market impacts. We suggest better targeting the earned income tax credit at families and low-income workers, lowering the top marginal tax rates, and maintaining the tax incentives for older workers.
This paper evaluates achievements and shortcomings of the Lisbon Strategy launched by the European Union in the spring of 2000 aiming to increase the competitiveness of the European economy within ten years. A careful examination of the Strategy’s pros and cons shows that its general rationale was sound and helpful despite an incorrect and naive political call to economically outperform the rest of the world in such period. The main priorities of the Strategy: promoting growth through creating more and better jobs and developing the knowledge base of the economy, remain valid for today and for the future. However, it has to be underlined that implementing desired changes requires time. At the moment, it is crucial to accomplish structural reforms, which have significant impact on job creation, business performance and growth. Among them, it is essential to complete the Single Market, still limited by many administrative barriers.
The paper shows main areas of necessary improvements to be undertaken by the Community and the member states. To strengthen real ownership of the Lisbon process, politicians must change their thinking from short-term and national to long-term and beneficial for the entire Community. Only such committed leadership can persuade the citizens to support the reforms, aiming to build a common European public good. Exploring these ideas would be a desirable return to the basic concept of the European Community, shaped by its founding fathers short after the World War II.
Authored by: Barbara Blaszczyk
Published in 2005
The paper discusses the current and potential role of the European Neighbourhood Policy (ENP) in anchoring economic reforms in the countries of the EU's Eastern Neighbourhood. It claims that it is too early to assess the success of the ENP in this sphere especially given that the actual progress of the ENP agenda has been limited. A review of the empirical evidence on external reform anchors confirms that the ENP shares some features with the EU accession process that has proven to be an effective mechanism supporting major economic, political and social changes in the countries concerned. The eventual ENP economic offer is meaningful and integration with the EU is getting stronger public support in several CIS countries and among their political elites. On the other hand several factors limit the reform anchoring potential of the ENP. This paper offers recommendations on policies that could strengthen this potential.
Authored by: Wojciech Paczynski
Published in 2009
The document is a thesis that examines principles of socially responsible investment and sustainable banking. It provides background on these topics and defines the problem of how to transition a regional/local bank's business towards sustainability. The research aims to identify factors that can limit or further this transition. The methodology includes literature reviews and case studies of sustainable banks and financial institutions. The findings show international SRI principles like transparency and risk management filtering down to local sustainable banking. However, banking realities like regulations and market interests also influence the transition process. Overall, sustainable banks can create public value through financial consulting, project exploration, and offering norm-setting products, though credibility is essential for integrity and competitive advantage.
In this paper we argue that aid effectiveness may suffer when partnerships with new regimes need to be established. We test this argument using the natural experiment of the break-up of communism in the former Eastern Bloc. We find that commercial and strategic concerns influenced both aid flows and the urgency of entry into new partnerships in the first half of the 1990s, while developmental objectives became more important only over time. These results hold up to a thorough sensitivity analysis, including using a gravity model to instrument for bilateral trade flows. We also find that aid fractionalization increased substantially, and that aid to the region was more likely to be tied, more volatile and less predictable than to aid to other recipients at the time. Overall, these results suggest that the guidelines for aid effectiveness agreed upon in the Paris Declaration are likely to be challenged by the current political transition in parts of the Arab world. Hopefully being aware of these challenges can help donors avoid making the same mistakes.
This work is done as contribution to the Regional Human Development Report 2004 section 3.7 on “Labor Markets”. The paper focuses on discussing peculiarities of the labor market transition in CIS countries, features of unemployment, labor legislation, and role of the trade unions.
The paper gathers information on the labor markets of CIS and Eastern European countries that was available by summer 2004, and draws policy recommendations based on comparison between these two groups of countries. The main conclusion is that the transformation of labor markets is not complete in any of the CIS countries; most of the problems that prevailed in the early 1990s remain. These include: centralized wage setting in five CIS countries – Belarus, Moldova, Tajikistan, Turkmenistan, and Uzbekistan; extensive unemployment and underemployment, much of which is hidden; ineffective systems of labor relations and social protection; large mismatches between the labor market skills supplied and the skills demanded by new market economies; inadequate official labor market data.
Fortunately, the strong economic growth experienced by most CIS countries since 1999 has increased the demand for labor and is putting downward pressures on unemployment rates. This offers a window of opportunity for policy makers seeking to further transform labor markets, and to modernize labor relations and social protection systems. The above analysis suggests the policy recommendations to speed up further transformation.
Authored by: Olga Pavlova, Oleksandr Rohozynsky
Published in 2005
La web 2.0 permite compartir información de manera pública o privada y transforma a los usuarios de pasivos a activos. Incluye sitios que facilitan compartir información y herramientas como blogs, wikis, repositorios, Flickr, YouTube y redes sociales que permiten a los usuarios producir y organizar contenido. La introducción de estas herramientas en las aulas escolares debe estimular la participación de los estudiantes, los procesos creativos de construcción del conocimiento y la retroalimentación continua.
Este documento presenta la estructura de un Proyecto Académico Terminal (PAT) para un programa de tecnología en ciencias de la salud. Incluye secciones introductorias sobre el título, coordinador y semestre del PAT. También describe secciones sobre el planteamiento del problema, formulación de la pregunta problema, marco teórico, metodología, resultados, discusión, conclusiones, recomendaciones y bibliografía. El marco teórico y otras secciones pueden presentarse en formato de mapa conceptual.
DR Richard Isaacs, MD joined Kaiser Permanente in 1995 and he has Advanced Certification in Head and Neck Oncologic Surgery. His specialties include: orbital, nasal, and maxillofacial surgery, as well as thyroid and parathyroid surgery. Additionally, Rich is trained in Facial Plastic and Reconstr.
A empresa está enfrentando desafios financeiros devido à pandemia e precisa cortar custos. O diretor financeiro recomenda demitir funcionários, cortar benefícios e adiar investimentos para economizar 1 milhão por mês. No entanto, isso pode prejudicar a moral e a produtividade dos funcionários restantes.
El documento describe los conceptos básicos de manejo de archivos en C, incluyendo los tipos de archivos (de texto y binarios), cómo abrir y cerrar archivos usando las funciones fopen() y fclose(), y cómo leer y escribir datos en archivos usando funciones como fprintf(), fscanf(), fgets() y fputs(). También explica conceptos como punteros a archivos, modos de apertura de archivos, y funciones para manipular archivos como rewind(), ferror() y remove().
Culture And Language Short Version Feb 18IraAsherman
This document discusses the challenges of building effective teams in a large global pharmaceutical company with 66,000 employees across 27 countries. Culture, language barriers, and geographic dispersion can slow down the drug development process and prevent the company from fully benefiting from diversity. The presentation explores how cultural differences, language issues, and remote teams impact performance and offers suggestions for enhancing effectiveness. Specifically, it addresses challenges like assumptions that all employees speak English fluently or share the same corporate culture, as well as differences in decision making, communication and relationship building across cultures.
The document contains a table of measurements for various clothing sizes labeled with codes. For each size code, it lists measurements including total length, front length, back length, bust, waist, hip, sleeve length, wrist circumference, knee circumference, and ankle circumference. The table contains multiple size codes and their corresponding measurements.
This document provides information about accommodations in Antigua Guatemala located close to popular landmarks for $171 per night. It also summarizes attractions in Guatemala like Tikal National Park, a UNESCO World Heritage site home to wildlife like foxes and monkeys, and the Jade Museum containing symbolic jade figures and craftswork. Additionally, it mentions Pacaya, an active volcano that has erupted numerous times and offers views from its 2,552 meter elevation.
Arun Kumar S V is seeking a position as a web, graphics, or usability designer. He has over 3 years of experience developing and supporting mainframe applications for AHOLD USA in retail domains. He is proficient in COBOL, DB2, VSAM, JCL, CICS, and mainframe tools like Control M and Endevor. Currently he works as a technology consultant at HP Global Soft where he creates web pages, provides support, and is responsible for metrics reporting. He has a bachelor's degree in computer science and an ITIL certification in IT service management.
The study by Eero Lehto, Petri Kuoppamäki, Matti Kari and Ilkka Kiema considers some widely used customer loyalty programmes in Finland and Sweden. In particular, the study analyses these arrangements in retail trade and financial markets. With easier tracking of customers, the benefits of concentration in retail trade as well as in insurance and banking operations have increased in Finland and elsewhere in Europe. Generally speaking, these customer loyalty programmes reward customers for concentrating their purchases to a company that offers benefits. The nature of the programmes differs, depending on whether the bonus is given in cash or as a discount on the company's products. From the viewpoint of consumers and competition, even more important is whether a potential discount is given for the same type of products or other types of goods entirely.
As is the consumers’ welfare is the main concern of competition and consumer law, this study evaluates the impact of customer loyalty programmes mainly by focusing on pricing and consumer surplus. We have also studied the effects of bundling with companies and consumers by means of theoretical models.
The problem of Finnish customer loyalty programmes with regard to competition and consumers is that they have, in many places, been extended to include several industries at a time. Limiting bonus programmes to only one 2-digit level industry could have a positive impact on competition and consumers. Another problem is the long duration of some benefits. Reducing the bonus accrual period to two years at least in the banking and insurance sectors would have healthy effects on competition. It would also be in the interest of consumers.
An international comparison suggests that the share of private services in terms of output and employment is rather low in Finland. This feature raises several interesting questions.
What explains this particular feature of the Finnish production structure? How has the great depression of the early 1990s influenced the structure of private services in Finland? What kind of policy measures could be implemented in order to increase the share of private services from a long-run perspective? Finnish service employment also contains a number of other interesting particularities in an international comparison.
Within a corporatist framework, these include a rather large public sector employer, high
female participation rate, but on the other hand a low share of part-time work.
This paper reviews the literature on optimal taxation of labour income and the empirical work on labour supply and the elasticity of taxable income in Sweden. It also presents an overview of Swedish taxation of labour income, offers calculations on the development in effective marginal tax rates and participation tax rates, and estimates, using the difference-indifferences method, the impact of tax incentives on employment rates of elderly workers. After this background, we ponder possibilities for reforming the Swedish tax system to
improve its labour market impacts. We suggest better targeting the earned income tax credit at families and low-income workers, lowering the top marginal tax rates, and maintaining the tax incentives for older workers.
This paper evaluates achievements and shortcomings of the Lisbon Strategy launched by the European Union in the spring of 2000 aiming to increase the competitiveness of the European economy within ten years. A careful examination of the Strategy’s pros and cons shows that its general rationale was sound and helpful despite an incorrect and naive political call to economically outperform the rest of the world in such period. The main priorities of the Strategy: promoting growth through creating more and better jobs and developing the knowledge base of the economy, remain valid for today and for the future. However, it has to be underlined that implementing desired changes requires time. At the moment, it is crucial to accomplish structural reforms, which have significant impact on job creation, business performance and growth. Among them, it is essential to complete the Single Market, still limited by many administrative barriers.
The paper shows main areas of necessary improvements to be undertaken by the Community and the member states. To strengthen real ownership of the Lisbon process, politicians must change their thinking from short-term and national to long-term and beneficial for the entire Community. Only such committed leadership can persuade the citizens to support the reforms, aiming to build a common European public good. Exploring these ideas would be a desirable return to the basic concept of the European Community, shaped by its founding fathers short after the World War II.
Authored by: Barbara Blaszczyk
Published in 2005
The paper discusses the current and potential role of the European Neighbourhood Policy (ENP) in anchoring economic reforms in the countries of the EU's Eastern Neighbourhood. It claims that it is too early to assess the success of the ENP in this sphere especially given that the actual progress of the ENP agenda has been limited. A review of the empirical evidence on external reform anchors confirms that the ENP shares some features with the EU accession process that has proven to be an effective mechanism supporting major economic, political and social changes in the countries concerned. The eventual ENP economic offer is meaningful and integration with the EU is getting stronger public support in several CIS countries and among their political elites. On the other hand several factors limit the reform anchoring potential of the ENP. This paper offers recommendations on policies that could strengthen this potential.
Authored by: Wojciech Paczynski
Published in 2009
The document is a thesis that examines principles of socially responsible investment and sustainable banking. It provides background on these topics and defines the problem of how to transition a regional/local bank's business towards sustainability. The research aims to identify factors that can limit or further this transition. The methodology includes literature reviews and case studies of sustainable banks and financial institutions. The findings show international SRI principles like transparency and risk management filtering down to local sustainable banking. However, banking realities like regulations and market interests also influence the transition process. Overall, sustainable banks can create public value through financial consulting, project exploration, and offering norm-setting products, though credibility is essential for integrity and competitive advantage.
In this paper we argue that aid effectiveness may suffer when partnerships with new regimes need to be established. We test this argument using the natural experiment of the break-up of communism in the former Eastern Bloc. We find that commercial and strategic concerns influenced both aid flows and the urgency of entry into new partnerships in the first half of the 1990s, while developmental objectives became more important only over time. These results hold up to a thorough sensitivity analysis, including using a gravity model to instrument for bilateral trade flows. We also find that aid fractionalization increased substantially, and that aid to the region was more likely to be tied, more volatile and less predictable than to aid to other recipients at the time. Overall, these results suggest that the guidelines for aid effectiveness agreed upon in the Paris Declaration are likely to be challenged by the current political transition in parts of the Arab world. Hopefully being aware of these challenges can help donors avoid making the same mistakes.
This work is done as contribution to the Regional Human Development Report 2004 section 3.7 on “Labor Markets”. The paper focuses on discussing peculiarities of the labor market transition in CIS countries, features of unemployment, labor legislation, and role of the trade unions.
The paper gathers information on the labor markets of CIS and Eastern European countries that was available by summer 2004, and draws policy recommendations based on comparison between these two groups of countries. The main conclusion is that the transformation of labor markets is not complete in any of the CIS countries; most of the problems that prevailed in the early 1990s remain. These include: centralized wage setting in five CIS countries – Belarus, Moldova, Tajikistan, Turkmenistan, and Uzbekistan; extensive unemployment and underemployment, much of which is hidden; ineffective systems of labor relations and social protection; large mismatches between the labor market skills supplied and the skills demanded by new market economies; inadequate official labor market data.
Fortunately, the strong economic growth experienced by most CIS countries since 1999 has increased the demand for labor and is putting downward pressures on unemployment rates. This offers a window of opportunity for policy makers seeking to further transform labor markets, and to modernize labor relations and social protection systems. The above analysis suggests the policy recommendations to speed up further transformation.
Authored by: Olga Pavlova, Oleksandr Rohozynsky
Published in 2005
La web 2.0 permite compartir información de manera pública o privada y transforma a los usuarios de pasivos a activos. Incluye sitios que facilitan compartir información y herramientas como blogs, wikis, repositorios, Flickr, YouTube y redes sociales que permiten a los usuarios producir y organizar contenido. La introducción de estas herramientas en las aulas escolares debe estimular la participación de los estudiantes, los procesos creativos de construcción del conocimiento y la retroalimentación continua.
Este documento presenta la estructura de un Proyecto Académico Terminal (PAT) para un programa de tecnología en ciencias de la salud. Incluye secciones introductorias sobre el título, coordinador y semestre del PAT. También describe secciones sobre el planteamiento del problema, formulación de la pregunta problema, marco teórico, metodología, resultados, discusión, conclusiones, recomendaciones y bibliografía. El marco teórico y otras secciones pueden presentarse en formato de mapa conceptual.
DR Richard Isaacs, MD joined Kaiser Permanente in 1995 and he has Advanced Certification in Head and Neck Oncologic Surgery. His specialties include: orbital, nasal, and maxillofacial surgery, as well as thyroid and parathyroid surgery. Additionally, Rich is trained in Facial Plastic and Reconstr.
A empresa está enfrentando desafios financeiros devido à pandemia e precisa cortar custos. O diretor financeiro recomenda demitir funcionários, cortar benefícios e adiar investimentos para economizar 1 milhão por mês. No entanto, isso pode prejudicar a moral e a produtividade dos funcionários restantes.
El documento describe los conceptos básicos de manejo de archivos en C, incluyendo los tipos de archivos (de texto y binarios), cómo abrir y cerrar archivos usando las funciones fopen() y fclose(), y cómo leer y escribir datos en archivos usando funciones como fprintf(), fscanf(), fgets() y fputs(). También explica conceptos como punteros a archivos, modos de apertura de archivos, y funciones para manipular archivos como rewind(), ferror() y remove().
Culture And Language Short Version Feb 18IraAsherman
This document discusses the challenges of building effective teams in a large global pharmaceutical company with 66,000 employees across 27 countries. Culture, language barriers, and geographic dispersion can slow down the drug development process and prevent the company from fully benefiting from diversity. The presentation explores how cultural differences, language issues, and remote teams impact performance and offers suggestions for enhancing effectiveness. Specifically, it addresses challenges like assumptions that all employees speak English fluently or share the same corporate culture, as well as differences in decision making, communication and relationship building across cultures.
The document contains a table of measurements for various clothing sizes labeled with codes. For each size code, it lists measurements including total length, front length, back length, bust, waist, hip, sleeve length, wrist circumference, knee circumference, and ankle circumference. The table contains multiple size codes and their corresponding measurements.
This document provides information about accommodations in Antigua Guatemala located close to popular landmarks for $171 per night. It also summarizes attractions in Guatemala like Tikal National Park, a UNESCO World Heritage site home to wildlife like foxes and monkeys, and the Jade Museum containing symbolic jade figures and craftswork. Additionally, it mentions Pacaya, an active volcano that has erupted numerous times and offers views from its 2,552 meter elevation.
Arun Kumar S V is seeking a position as a web, graphics, or usability designer. He has over 3 years of experience developing and supporting mainframe applications for AHOLD USA in retail domains. He is proficient in COBOL, DB2, VSAM, JCL, CICS, and mainframe tools like Control M and Endevor. Currently he works as a technology consultant at HP Global Soft where he creates web pages, provides support, and is responsible for metrics reporting. He has a bachelor's degree in computer science and an ITIL certification in IT service management.
II-SDV Arne Krüger - Elastic Search & Patent Information @ mtcDr. Haxel Consult
This presentation will introduce our next generation patent publication store with Elastic Search 2.0 and our own modules for query translation, document access and content delivery. This is how we think, offices and data providers should give access to their content and backends. But they won't, and we will. We have our alpha version ready to show off its features and are curious about your feedback.
Computation of a gearbox for a wind power plantPietro Galli
The project Computation of a Gearbox for a Wind Power Plant dealt with the study and the analysis of the Generator in order to provide data about the following characteristics
o Static Design of the gearbox:
Design of shaft 1
Design of bearings
Internal stresses
Safety factor
Design of shaft 2
o Fatigue analysis:
Shaft 1 section 3
Shaft 1 section 4
Shaft 2 section 1
Shaft 2 section 2
o Rolling bearings analysis, life and fatique:
Roller bearings C and D
Bearing E
Rating life_bearing D
Rating life_bearing E
o Spur gears analysis:
Computation of transmission ratio, pt and b
Tooth bending strength
Tooth surface fatigue strength
An Oracle database consists of objects like tables, views, and programs owned by user accounts. SQL is used to perform operations on database objects like creating, modifying, viewing, and deleting them. There are two main types of SQL commands: DDL for defining objects and DML for manipulating data. Users have privileges like creating tables or inserting data that are assigned by the database administrator. Database objects must follow naming conventions and can be created and modified using SQL commands in tools like SQL*Plus.
El documento resume las características principales del Barroco en España. Explica que hubo tres periodos: Primer Barroco, Barroco Pleno y Rococó. Describe la arquitectura, escultura e imaginería de cada época, haciendo hincapié en la influencia de la Iglesia Católica. También analiza las principales características y obras maestras de la pintura española del Siglo de Oro, con artistas como Velázquez, Zurbarán y Murillo.
Las funciones en PHP permiten agrupar bloques de código reutilizables que pueden ser llamados dentro y fuera de otras funciones. Las funciones pueden recibir parámetros y devolver resultados, y son una herramienta útil para reducir la longitud del código y su complejidad. Existen varias comunidades en línea que ofrecen recursos y apoyo para aprender a crear e invocar funciones en PHP.
This document discusses gender budgeting in civil society. It defines gender budgeting as applying a gender perspective to all stages of the budgetary process. This makes budgets more transparent and helps promote gender equality. The document outlines how gender budgeting is based in laws promoting equal opportunities and how it was implemented differently in Germany and Austria. It describes how gender budgeting analyzes budgets to understand their impacts on women and men.
The Issue of Political Investment in Interstate Relations On the Example of U...ijtsrd
The article is devoted to the analysis of the role and significance of political investment in interstate relations on the example of cooperation between Uzbekistan and France. The analysis in the article is carried out in two directions. Firstly, the essence and features of the concept of “political investment” are studied. Despite its presence in interstate and international relations, this term is poorly understood in scientific and academic communities. Secondly, the main areas of Uzbek French cooperation within the framework of this concept are considered. Yulduz Makhmasobirova "The Issue of Political Investment in Interstate Relations: On the Example of Uzbek-French Cooperation" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-6 | Issue-2 , February 2022, URL: https://www.ijtsrd.com/papers/ijtsrd49186.pdf Paper URL: https://www.ijtsrd.com/humanities-and-the-arts/political-science/49186/the-issue-of-political-investment-in-interstate-relations-on-the-example-of-uzbekfrench-cooperation/yulduz-makhmasobirova
This article provides an overview of social entrepreneurship and social enterprises from an international perspective. It discusses how social enterprises vary between countries based on differences in welfare systems, economies, and legal systems. The distribution of social enterprises is uneven worldwide. The article also argues that for social enterprises to achieve their social missions, they must foster innovation in their outlook, strategies, and operations. The papers in this special issue present different models and theories of how social enterprises can promote innovation from an interdisciplinary and cross-cultural lens. They also discuss how social enterprise outcomes are prioritized in different societies and can offer innovative solutions to social problems.
This document summarizes the key points of a paper on the role of business in civil society governance. It discusses how civil society organizations (CSOs) and businesses are increasingly forming strategic alliances to achieve their objectives. Such alliances allow them to share risks, resources, and complementary skills. However, they also carry risks related to incompatible cultures and objectives between the partners. The document uses the example of Hindustan Unilever Limited in India to illustrate how alliances with local CSOs and governments helped the company expand into rural markets among low-income populations. Overall, the strategic alliances are changing the governance of CSOs by increasing emphasis on performance measurement, accountability, and aligning more with business partners'
What does it mean to be a lobbyist? What does it mean to work in public affairs? This internal dialogue and our collaboration with the members of the Public Affairs Work Group form the basis of a report which we quote and elaborate below.
The programme introduces the joint views of the two employee federations, SAK and STTK, on the basis of which Finland will be able to promote economic growth and create decent jobs. This will enhance the ability to finance the welfare state and to promote social cohesion in Finland.
Central Organisation of Finnish Trade Unions SAK and Finnish Confederation of Professionals STTK.
8th January 2013
Fife Centre for Equalities position on Social Mobility and the Time for Change consultation. This is in parallel with on-going work on the inclusion of the socio-economic duty in the Equality Act 2010.
Global governance and the interface withbusiness new instit.docxbudbarber38650
Global governance and the interface with
business: new institutions, processes and
partnerships
Partnered governance: aligning corporate
responsibility and public policy in the global
economy
Atle Midttun
Abstract
Purpose – The purpose of this paper is to note the remarkable expansion of corporate social
responsibility (CSR) throughout the late 1990s and early 2000s. Taking this as point of departure, it aims
to discuss the potential for aligning CSR-oriented industrial self-regulation with public governance to fill
some of the governance gap in the global economy.
Design/methodology/approach – The paper provides a conceptual discussion, empirically
underpinned by three case studies.
Findings – The paper finds that it is plausible, and empirically supported by the case studies, to
conceive of a considerable role for CSR based self-regulation in the global economy. A central
precondition is the ability of civil society organizations to establish ‘‘moral rights’’ as credible voices for
‘‘just causes’’ in a media-driven communicative society, and thereby put pressure on brand sensitive
industry. The paper finds that corporate self-regulation may fill a larger part of the governance gap if
public policy is oriented to engage with industry in a partnered mode.
Research limitations/implications – The paper establishes a conceptual base for exploring the
governance implications of CSR, casuistically underpinned by three case studies. Further studies are
needed, however, to explore the scale and scope of partnered governance in the global economy.
Practical implications – The paper provides insights into an approach to increase governability of the
global economy.
Originality/value – The originality of the paper lies in exploring the implications of CSR for governance,
and for highlighting how the governance potential may be enhanced by reorientation of public policy.
Keywords Governance, Corporate social responsibility, Globalization, Regulation
Paper type Conceptual paper
Introduction
The late twentieth and the early twenty-first centuries have seen increasing economic
globalization in the form of both globally extended capital markets and extended
outsourcing of production in global supply systems across the world. After three decades of
predominant liberalist orientation, the international economy remains strongly
pro-commercially biased.
International governance of social and environmental concerns has been relatively much
weaker, reflecting the lack of resourceful engagement by committed powerful actors and
PAGE 406 j CORPORATE GOVERNANCE j VOL. 8 NO. 4 2008, pp. 406-418, Q Emerald Group Publishing Limited, ISSN 1472-0701 DOI 10.1108/14720700810899158
Atle Midttun is based at the
Norwegian School of
Management, Oslo,
Norway.
The author is grateful to the
Research Council of Norway for
support to this article under the
projects ‘‘C(S)R in Global Value
Chains’’ and ‘‘Sustainability for
the 21st Century: Overcomi.
The document discusses how partnership and collaboration in the public sector has become increasingly important over the last 20 years but faces new challenges due to budget cuts. It argues that despite rhetoric around multi-agency working, partnerships are often passive and instrumental. However, the economic downturn could provide new opportunities for meaningful collaboration if public leaders emphasize cooperative values. The rest of the paper reflects on lessons from New Labour's regeneration programs and incorporating the voluntary sector, and argues for strengthening independent local networks to develop alternative frameworks to the dominant neoliberal agenda.
Building a Participative Growth Foundation: Make a European Sense of an Econo...Siripong Treetasanatavorn
This article puts forward an argumentation that a successful growth transformation requires people to work together for a mutual benefit, that is, growth often makes sense with partnership at the foundation. The EU leadership should lead changes on a strength position that emphasizes the necessity of a coming-together that creates a winning inside-out growth reform that resonates across social, economic and political dimensions and gains broadest possible public acceptance to achieve a strongest possible mandate that moves the public beyond one’s causes.
Key principle of this contribution presupposes that every meaningful policy must aim at serving people. In political terms, growth should mean cooperation based on fairness and a leadership demonstration thereof. Growth transformation
requires an orchestration platform that engages people towards actions. However, forward-looking, far-reaching and holistic growth policy shall never be exhaustive without a long-term sense-making outlook from a global perspective – indeed as
meaningful and practical as its legitimacy and ownership by the people.
In implementation terms, the policy transformation should aim at sustainable growth dynamics, resonating and orchestrating across multiple levels, policy disciplines and country members with a goal-oriented, comprehensive yet people-near management organ. Win-win partnership lies at heart of the transformation.
Cultural, Economic, Political And Industrial Relation...Lissette Hartman
This document discusses factors a Chinese steel factory must consider when deciding whether to open a new production facility in Britain or Sweden. It examines the cultural, economic, political, and industrial relations contexts in both countries. In Sweden, there are strong worker protections including collective bargaining, high union membership, and centralized unions. However, rigid labor laws can inhibit foreign investment. The UK takes a more hands-off approach but unions no longer wield strong influence. After reviewing these issues, the document will conclude with a recommendation for the best country.
This document discusses corporate social responsibility (CSR) in Belgium, particularly for small and medium enterprises. It provides background on the Belgian economy and the key role of SMEs. CSR in Belgium has origins in pioneering legislation and the social economic council. Drivers of CSR include values related to employees, competitive advantage, and added value. The government aims to promote CSR through legal frameworks, policies, and stakeholder dialogue on non-discrimination, public procurement, fair trade, and transparency.
This document discusses financial restructuring in the Organization of Eastern Caribbean States countries. It notes that as economies develop, non-bank financial institutions have begun competing with banks by offering similar retail and wholesale services. This has led to a shift away from bank dominance in financial intermediation to non-banks. The document examines this process of financial restructuring and discusses some associated policy issues regarding the development of financial systems in these countries.
This document summarizes key points from an interview with Sir Winfried Bischoff, Chairman of the Financial Reporting Council, on the topic of corporate culture. Sir Winfried discusses how corporate culture and trust are important for business success and society. He notes that companies need to consider the views of all stakeholders, not just shareholders, and establish a culture that encourages good behavior throughout the organization. Sir Winfried also discusses how companies can define and measure culture using various metrics, and that maintaining a healthy culture requires ongoing effort from boards. The role of the FRC is to promote high quality governance and reporting in the public interest.
This document provides a critical analysis of Aid for Trade (AfT) programs. It argues that while AfT discourse promotes norms of poverty reduction and fair trade, the actual outcomes of AfT assistance may differ. Donor institutions use AfT narratives to rationalize trade liberalization agendas and embed "pro-poor" norms within trade systems. However, concerns remain that AfT funds are insufficient and slow to arrive. The material impact of AfT on infrastructure, governance, and private sector development is also questioned. A moral economy perspective is applied to examine potential gaps between AfT discourse and outcomes for the poor.
The document provides background information on Social Impact Bonds (SIBs). It discusses SIBs as a form of public-private partnership that integrates philanthropy, venture capitalism, social program financing, and performance management. A SIB involves contracts between a government payer, private investors, social service providers, an intermediary, and an external evaluator. Private investors provide upfront capital for social programs, and the government pays investors back based on outcomes achieved. SIBs aim to incentivize effective social solutions by tying payment to results rather than inputs/outputs. However, literature on SIBs is still limited, with opportunities to better understand collaborative barriers and the role of intermediaries in facilitating multi-stakeholder partnerships
State business and economic performance in ghanaDr Lendy Spires
This document analyzes state-business relations (SBRs) in Ghana and their impact on economic performance. It finds that effective SBRs, characterized by formal and regular engagement between government and businesses, correlate with improved firm productivity and economic growth. A quantitative analysis of over 250 Ghanaian firms from 1991-2002 showed that social networks and connections between firms and government increased productivity. Interviews with state agencies and businesses confirmed that SBRs have shifted from informal to more formal and synergistic relations since 1992, with positive effects like expedited import clearance. Overall, the study concludes that an enabling environment and effective SBRs are important for private sector development, investment, and poverty reduction in Ghana.
Is Social Enterprise Ready for Public Business.D.GRANT. May 1st 2015-FDeborah Grant
This document is a thesis submitted to Dr. Susan Laing exploring whether social enterprises are ready to compete for public sector contracts. It includes an abstract, 6 chapters, and references. The abstract provides a high-level summary of the thesis, which conducted a literature review on social enterprises followed by interviews with social enterprise CEOs, membership organization leaders, and government/procurement specialists in Scotland, the UK, and Canada. Common themes and potential conflicts were identified, and recommendations were made on improving relationships and social enterprise involvement in the procurement process. In conclusion, the research aims to contribute to ongoing discussions around social enterprises and their economic contributions, with a key finding being that Scotland understands the questions around social enterprises well due to extensive experience.
Similar to The Finnish incomes policy as corporatist political exchange: development of social capital and the social wage (20)
Talous & Yhteiskunta -lehden numero 4/2019 sisältää artikkeleita ja haastattelun, jotka kertovat alueellista keskittymistä käsitelleistä tutkimuksista. Suomen seitsemän suurimman kaupunkiseudun väestö kasvaa nopeimmin, kun taas pienempien kaupunkien ja maaseudun väestöosuus supistuu. Muutos on kuitenkin verrattain hidasta, ja sille on myös vastavoimia.
Talous & Yhteiskunta -lehden numeron 3/2019 teemana on työ ja terveys. Artikkeleissa tarkastellaan Suomen terveydenhuoltojärjestelmän toimivuutta ja pohditaan mitä voitaisiin oppia Ruotsissa jo tehdyistä terveydenhuollon uudistuksista. Muissa artikkeleissa käsitellään terveyskäyttäytymisen ja työmarkkinamenestyksen yhteyttä, työttömien aktivointia, työikäisten eritasoisia terveyspalveluja, työaikajoustojen vaikutusta terveyteen sekä informaatioteknologian ja tekoälyn käyttöä mielenterveyspalvelujen tukena. Haastateltavana on THL:n tutkimusprofessori Unto Häkkinen. Hänen mielestään sote-uudistus on tehtävä, vaikka se vaatiikin vielä monen yksityiskohdan ratkaisemista.
Opiskelijavalinta ylioppilaskirjoitusten nykyarvosanojen perusteella ei ole täysin perusteltua, todetaan Aalto-ylipiston ja Palkansaajien tutkimuslaitoksen uudessa tutkimuksessa. Ylioppilaskirjoitusten arvosanoilla on pitkän ajan vaikutuksia. Hienojakoisempi arvosteluasteikko tekisi opiskelijavalinnasta nykyistä reilumman.
Esimerkkiperhelaskelmissa tarkastellaan seitsemää kotitaloutta. Laskelmat kuvaavat ansiotulojen, tulonsiirtojen sekä verojen ja veronluonteisten maksujen kehityksen vaikutusta perheiden ostovoimaan. Perheille lasketaan Tilastokeskuksen tietoihin perustuvat perhekohtaiset kulutuskorit, jotka mahdollistavat perhekohtaisten inflaatiovauhtien ja reaalitulokehitysten arvioinnin. Ensi vuonna eläkeläispariskunnan ostovoima kasvaa eniten ja työttömien vähiten. Esimerkkiperhelaskelmia on tehty Palkansaajien tutkimuslaitoksella vuodesta 2009 lähtien.
Palkansaajien tutkimuslaitos ennustaa Suomen talouskasvuksi tänä vuonna 1,3 prosenttia ja ensi vuonna 1,1 prosenttia. Kasvua hidastaa eniten yksityisen kulutuksen kasvun hidastuminen. Toisaalta vienti kasvaa tänä vuonna hieman ennakoitua nopeammin, neljä prosenttia, ja ensi vuonnakin vielä kaksi prosenttia. Tuotannollisten investointien kasvu jatkuu maltillisena, mutta rakentamisen vähentyminen kääntää yksityiset investoinnit kokonaisuutena pieneen laskuun ensi vuonna. Hallituksen vuoteen 2023 mennessä tavoittelemien 75 prosentin työllisyysasteen ja julkisen talouden tasapainon toteutumista on vaikea arvioida, koska nämä tavoitteet on määritelty rakenteellisina ja niiden eri arviointimenetelmät saattavat tuottaa hyvin erilaisia tuloksia.
Suomen palkkataso oli 2015 ylempää eurooppalaista keskitasoa. Suomen suhteellinen asema ei ole juurikaan muuttunut 2010-luvun alun tilanteesta. Hintatason huomioiminen kuitenkin heikentää asemaamme palkkavertailussa. Palkkaerot meillä olivat vertailumaiden pienimpiä ja pysyivät melko samalla tasolla koko tarkastelujakson 2007–2015 ajan. EU-maissa havaittiin erisuuntaista kehitystä palkkaeroissa. Suurin osa palkkojen kokonaisvaihteluista selittyi taustaryhmien sisäisillä palkkaeroilla.
Suomessa toteutettiin vuonna 2005 laaja eläkeuudistus, jossa vanhuuseläkkeen alaikärajaa laskettiin. Tutkimuksessa havaitaan, että ikärajan lasku aikaisti eläkkeelle jäämistä. Kun alaraja laskettiin 65:stä 63:een, myös yleinen eläköitymisikä laski. Taloudellisten kannustimien muutosten vaikutukset eläköitymiseen jäivät paljon heikommiksi alaikärajan muuttamiseen verrattuna. Eläköitymisikään voidaan siis vaikuttaa tehokkaasti ja vähäisin kustannuksin lakisääteistä eläkeikää muuttamalla.
Talous & Yhteiskunta -lehden numeron 2/2019 artikkelit ja haastattelu kertovat tutkimuksista, joita on tehty Suomen Akatemian strategisen tutkimuksen neuvoston hankkeessa "Osaavat työntekijät - menestyvät työmarkkinat". Keskeinen kysymys on, miten sopeudutaan teknologisen kehityksen mukanaan tuomaan työn murrokseen.
Tutkimuksessa tarkastellaan ammattirakenteiden polarisaatiota sekä sitä, että mihin supistuvissa ja rutiininomaisissa ammateissa olevat työntekijät päätyvät hyödyntämällä kokonaisaineistoa vuosille 1970-2014. Ammattirakenteiden polarisaatio on jatkunut Suomessa jo vuosikymmeniä. Ammattirakennemuutoksen kehityskulku on pääosin tapahtunut siten, että keskitason tuotanto- ja toimistotyöntekijät ovat nousseet urapolkuja pitkin asiantuntijatöihin. Viimeaikaista palveluammattien osuutta on puolestaan kasvattanut se, että nuoret siirtyvät työmarkkinoille palvelutöihin. Rutiininomaisia ja kognitiivisia taitoja vaativien ammattien työntekijöillä on kuitenkin suurempi todennäköisyys nousta korkeammille palkkaluokille rutiininomaista ja fyysistä työtä tekeviin työntekijöihin verrattuna. Rutiininomaista ja fyysistä työtä tekevät tippuvat puolestaan suuremmalla todennäköisyydellä matalapalkka-aloille, ja heidän ansiotason kehitys on myös heikompaa.
Palkansaajien tutkimuslaitos on alentanut Suomen talouskasvun ennustettaan kuluvalle vuodelle viimesyksyisestä 2,3 prosentista 1,4 prosenttiin. Kansainvälisen talouden näkymien epävarmuus hidastaa Suomen talouskasvua etenkin kuluvana vuonna. Jos pahimmat uhkakuvat jäävät toteutumatta, kasvu piristyy ensi vuonna hivenen 1,5 prosenttiin. Viime vuonna pysähtynyt viennin kasvu elpyy, ja myös yksityisen kulutuksen kasvu tukee talouskasvua. Suomi on sopeutunut ammattirakenteiden murrokseen yleisesti ottaen hyvin, mutta etenkin perusasteen koulutuksen varassa olevien varttuneiden työntekijöiden työllistämiseen voi olla vaikea löytää työkaluja.
The Labour Institute for Economic Research has lowered its forecast of Finland’s economic growth for the current year from last autumn’s 2.4 per cent to 1.4 per cent. Uncertainty in the international economic outlook will slow Finland’s economic growth, particularly this year. If the worst threats do not materialise, growth will pick up slightly next year to 1.5 per cent. Export growth, which came to a halt last year, will recover and growth in private consumption growth will also provide support to economic growth. In general, Finland has adjusted well to occupational restructuring, but it may be difficult to find means to employ older workers who only have basic education.
Palkansaajien tutkimuslaitos on alentanut Suomen talouskasvun ennustettaan kuluvalle vuodelle vii-mesyksyisestä 2,3 prosentista 1,4 prosenttiin. Kansainvälisen talouden näkymien epävarmuus hidastaa Suomen talouskasvua etenkin kuluvana vuonna. Jos pahimmat uhkakuvat jäävät toteutumatta, kasvu piristyy ensi vuonna hivenen 1,5 prosenttiin. Viime vuonna pysähtynyt viennin kasvu elpyy, ja myös yksityisen kulutuksen kasvu tukee talouskasvua. Suomi on sopeutunut ammattirakenteiden murrokseen yleisesti ottaen hyvin, mutta etenkin perusasteen koulutuksen varassa olevien varttuneiden työntekijöiden työllistämiseen voi olla vaikea löytää työkaluja.
Tämä PT Policy Brief tuo esiin havaintoja Suomen tuloerojen kehityksestä 1990-luvun puolivälin jälkeen. Tällä ajanjaksolla tuloerot ovat kasvaneet. Aluksi kasvu oli hyvin nopeaa, kunnes kehitys tasaantui finanssikriisin myötä. Tämä näkyy tarkasteltaessa kehitystä viiden vuoden ajalta lasketuissa keskituloissa. Taloudessa on tuloliikkuvuutta, ts. tulot vaihtelevat vuodesta toiseen. Havaitsemme, että liikkuvuus tuloportaikossa on vähentynyt. Samalla kun tuloerot ovat kääntyneet kasvuun, on tuloverotuksen progressiivisuus alentunut. Valtion tuloveron alennusten ohella tähän on erityisesti tulojakauman huipulla vaikuttanut pääomatulojen voimakas kasvu.
Julkisen budjetin sopeuttamistoimia toteutetaan usein etuuksien indeksileikkauksina tai tuloverojen korotuksina. Näillä toimenpiteillä on tulonjako- ja työllisyysvaikutuksia. Tämä PT Policy Brief esittää SISU-mallilla lasketut vaikutukset käytettävissä oleviin tuloihin tuloluokittain, jos valtion tuloveroasteikkoa korotettaisiin 0,4 prosenttiyksiköllä tai jos kansaneläkeindeksiä leikattaisiin. Molemmissa toimenpiteissä budjetti vahvistuisi 180 miljoonalla eurolla mutta tulonjakovaikutukset ovat huomattavan erilaiset. Oheisen kuvion mukaisesti indeksileikkaukset kohdistuvat voimakkaasti alempiin tulonsaajakymmenyksiin, kun taas tuloveron korotukset kohdistuvat ylempiin kymmenyksiin. Kun huomioidaan muutosten aiheuttamat työllisyysvaikutukset, kokonaiskuva muuttuu vain hieman.
Makeisvero otettiin käyttöön makeisille ja jäätelölle vuoden 2011 alusta. Virallinen perustelu oli kerätä verotuloja, mutta poliittisessa keskustelussa selvä tavoite oli ohjata kulutusta terveellisempään suuntaan. Makeisvero nosti selvästi makeisten kuluttajahintoja, mutta se ei vaikuttanut makeisten kysyntään. Toisaalta vuonna 2014 virvoitusjuomavero nousi sokerillisille juomille, mutta sokerittomat juomat jäivät alemmalle verotasolle. Tämä muutos alensi sokerillisten juomien kulutusta ja ohjasi kulutusta sokerittomiin juomiin. Onnistunut terveellisiin tuotteisiin ohjailu näyttääkin vaativan riittävän läheisen terveellisempien tuotteiden ryhmän olemassaolon.
Talous & Yhteiskunta-lehden "Suuren vaalinumeron" 1/2019 jutut käsittelevät aiheita, jotka voivat nousta esille kevään vaalikeskusteluissa. Pääpaino on ilmastonmuutoksessa: haastateltavana on Maailman ilmatieteen järjestön pääsihteeri Petteri Taalas, ja kahdessa eri artikkelissa pohditaan metsien hiilinielujen ja yhdyskuntarakenteen merkitystä pyrittäessä hillitsemään ilmaston lämpenemistä. Muut artikkelit käsittelevät tuloerojen kasvua, sotea, eläkkeiden riittävyyttä, maahanmuuttajien työllistymistä, EMUn uudistamista, eurooppalaista palkkavertailua ja kestävyysvajeen sopimattomuutta talouspolitiikan suunnitteluun.
Raportissa tehdään laskelmia korkeakouluopiskelijoille suunnatun opintotuen tulorajojen muutosten vaikutuksista. Opintotuen tulorajojen tavoite on, että suurituloisille opiskelijoille ei makseta opintotukea. Samalla nykyiset tulorajat kuitenkin estävät opiskelijoita tienaamasta niin paljon kuin he haluaisivat. Laskelmissa hyödynnetään simulaatiomallia, jonka avulla voidaan arvioida miten opiskelijoiden tulojakauma muuttuisi eri vaihtoehtoisissa opintotuen tulorajojen muutoksissa. Tulosten mukaan nykyisiä tulorajaoja voisi nostaa esimerkiksi 50 prosentilla, jolloin yhdeksän kuukauden ajan opintotukea nostavan opiskelijan vuosituloraja olisi 18 000 euroa nykyisen noin 12 000 euron sijaan. Laskelmien mukaan tällöin päästäisiin opintotuen nykyisten tulorajojen haitallisista tulovaikutuksista laajasti ottaen eroon, koska vain harva opiskelija tienaisi tätä tulorajaa enempää. Ottaen huomioon verotulot ja tulonsiirrot tämä vaihtoehto lisäisi julkisyhteisöjen nettotuloja arviolta 5,9 miljoonaa euroa vuodessa.
Tässä tutkimuksessa tutkitaan diskreettien valintajoukkojen vaikutusta palkansaajien työn tarjonnan reagoimiseen tuloveroihin. Artikkelin empiirisessä osiossa hyödynnetään opintotuen tulorajojen aiheuttamaa tuloveroissa tapahtuvaa äkillistä nousua, ja reformia, jossa tulorajoja nostettiin. Tulosten mukaan vuoden 2008 reformi, jossa tulorajaa nostettiin 9 opintotukikuukautta nostaneille 9000 eurosta 12000 euroon, aiheutti merkittäviä muutoksia opiskelijoiden tulojakaumassa. Tulojakauma siirtyi korkeammalle tasolle lähtien noin 2000 euron tuloista. Koska opiskelijoiden verojärjestelmässä ei tapahtunut muutoksia näin alhaisella tasolla vuoden 2008 reformissa, eivät työn taloustieteen normaalit mallit pysty selittämään tätä siirtymää. Artikkelissa esitetään empiirisiä lisätuloksia, teoreettisia argumentteja ja simulaatiomalli, jotka kaikki viittaavat siihen, että tuloksen pystyy selittämään diskreettien valintajoukkojen mallilla. Lisäksi artikkelissa esitetään, että verotuksen hyvinvointitappiot voivat olla suuremmat kuin empiirisesti estimoidut, jos valintajoukot ovat diskreettejä, mutta niiden ajatellaan olevan jatkuvia.
Talous & Yhteiskunta -lehden uuteen numeroon sisältyy artikkeleita veropohjasta ja -vajeesta, liikenteen veroista, naisista tulojakauman huipulla, työllisyyden kasvusta, mikrosimulaatiomalleista ja digitalisaatiosta. Lehdessä on myös Helsingin yliopiston professori Uskali Mäen haastattelu, jossa käsitellään tieteenfilosofista näkökulmaa taloustieteeseen.
Tutkimuksessa rakennettiin uusia makrotaloudellisia malleja PT:n ennustetyötä varten. Malleilla tehtiin ennusteita vuosille 2017 ja 2018. Mallien BKT-ennuste vuodelle 2017 on 3,1 prosenttia (vrt. toteutunut 2,8 prosenttia) ja vuodelle 2018 1,8 prosenttia (vrt. PT:n 11.9 ennuste 2,7 prosenttia).
United Nations World Oceans Day 2024; June 8th " Awaken new dephts".Christina Parmionova
The program will expand our perspectives and appreciation for our blue planet, build new foundations for our relationship to the ocean, and ignite a wave of action toward necessary change.
Jennifer Schaus and Associates hosts a complimentary webinar series on The FAR in 2024. Join the webinars on Wednesdays and Fridays at noon, eastern.
Recordings are on YouTube and the company website.
https://www.youtube.com/@jenniferschaus/videos
RFP for Reno's Community Assistance CenterThis Is Reno
Property appraisals completed in May for downtown Reno’s Community Assistance and Triage Centers (CAC) reveal that repairing the buildings to bring them back into service would cost an estimated $10.1 million—nearly four times the amount previously reported by city staff.
karnataka housing board schemes . all schemesnarinav14
The Karnataka government, along with the central government’s Pradhan Mantri Awas Yojana (PMAY), offers various housing schemes to cater to the diverse needs of citizens across the state. This article provides a comprehensive overview of the major housing schemes available in the Karnataka housing board for both urban and rural areas in 2024.
Jennifer Schaus and Associates hosts a complimentary webinar series on The FAR in 2024. Join the webinars on Wednesdays and Fridays at noon, eastern.
Recordings are on YouTube and the company website.
https://www.youtube.com/@jenniferschaus/videos
This report explores the significance of border towns and spaces for strengthening responses to young people on the move. In particular it explores the linkages of young people to local service centres with the aim of further developing service, protection, and support strategies for migrant children in border areas across the region. The report is based on a small-scale fieldwork study in the border towns of Chipata and Katete in Zambia conducted in July 2023. Border towns and spaces provide a rich source of information about issues related to the informal or irregular movement of young people across borders, including smuggling and trafficking. They can help build a picture of the nature and scope of the type of movement young migrants undertake and also the forms of protection available to them. Border towns and spaces also provide a lens through which we can better understand the vulnerabilities of young people on the move and, critically, the strategies they use to navigate challenges and access support.
The findings in this report highlight some of the key factors shaping the experiences and vulnerabilities of young people on the move – particularly their proximity to border spaces and how this affects the risks that they face. The report describes strategies that young people on the move employ to remain below the radar of visibility to state and non-state actors due to fear of arrest, detention, and deportation while also trying to keep themselves safe and access support in border towns. These strategies of (in)visibility provide a way to protect themselves yet at the same time also heighten some of the risks young people face as their vulnerabilities are not always recognised by those who could offer support.
In this report we show that the realities and challenges of life and migration in this region and in Zambia need to be better understood for support to be strengthened and tuned to meet the specific needs of young people on the move. This includes understanding the role of state and non-state stakeholders, the impact of laws and policies and, critically, the experiences of the young people themselves. We provide recommendations for immediate action, recommendations for programming to support young people on the move in the two towns that would reduce risk for young people in this area, and recommendations for longer term policy advocacy.
The Antyodaya Saral Haryana Portal is a pioneering initiative by the Government of Haryana aimed at providing citizens with seamless access to a wide range of government services
The Finnish incomes policy as corporatist political exchange: development of social capital and the social wage
1. 256
The Finnish
incomes policy as
corporatist political
exchange:
development of
social capital and
the social wage
Jaakko Kiander
Pekka Sauramo
Hannu Tanninen
2. PALKANSAAJIEN TUTKIMUSLAITOS •TYÖPAPEREITA
LABOUR INSTITUTE FOR ECONOMIC RESEARCH • DISCUSSION PAPERS
This paper is a slightly revised version of the paper presented at the conference “Labour Markets and
Welfare States” organized by the Nordic Centre of Excellence: The Nordic Welfare State – Historical
Foundations and Future Challenges (NordWel) in Stockholm on 13 May 2009. The paper reports on
the project which was part of the research programme on social capital and networks of trust funded
by the Finnish Academy. The project was also financed by the Finnish Work Environment Fund and
the Finnish Employees’ Foundation.
* Labour Institute for Economic Research, Pitkänsillanranta 3A FIN-00530 Helsinki, Finland, and
** University of Eastern Finland, Department of Health and Social Management, P.O. Box 1627,
FIN-70211 Kuopio, Finland
Helsinki 2009
256
The Finnish
incomes policy as
corporatist political
exchange:
development of
social capital and
the social wage
Jaakko Kiander*
Pekka Sauramo*
Hannu Tanninen**
4. 3
ABSTRACT
The paper is concerned with the history of the Finnish incomes policy, covering the period from the
Second World War to the present. It deals with the Finnish incomes policy as a special type of
political exchange between the social partners and the Government. In pursuing wage moderation,
governments have used welfare reforms as a means of exchange for solving certain externalities
arising in wage bargaining.
The continuity of political exchange between the social partners and the Government requires a
common ground of values and trust. In the paper, these prerequisites are characterised by the use of
the concept of social capital. Social capital can be interpreted as a relationship of horizontal trust
between the social partners and the Government. This interpretation is closely related to Bo
Rothstein’s concept of organised social capital. Accordingly, the paper emphasises the importance of
the institutional framework within which incomes policy negotiations have been carried out as an
important promoter of social capital between the social partners and the Government.
The paper also emphasises the importance of centrally negotiated incomes policy agreements as an
important institutional framework within which the Finnish welfare state has evolved. For example,
the earnings-related pension scheme has been developed mostly within the framework.
The paper discusses not only the history but also the present and the future of the Finnish incomes
policy. Owing to the traditionally close relationship between centrally negotiated incomes policy
agreements and welfare reforms, the end of centrally negotiated incomes policy agreements declared
by one of the social partners, the Confederation of Finnish Industries, is likely to affect not only the
manner in which wages are negotiated in the future but also the tradition of political exchange
between the social partners and the Government. The end of centrally negotiated incomes policy
agreements may put an end to political exchange, too. Furthermore, it may give rise to a deterioration
of social capital between the social partners.
Key words: incomes policy, political exchange, social capital, social wage
5. 4
TIIVISTELMÄ
Kirjoituksessa tarkastellaan suomalaisen tulopolitiikan historiaa toisesta maailmansodasta nykypäi-
vään. Suomalaisen tulopolitiikan peruspiirteen voi tiivistää luonnehtimalla tulopolitiikkaa työmarkki-
najärjestöjen ja valtiovaltaa edustavan hallituksen väliseksi institutionalisoiduksi kolmikantaiseksi
yhteistyöksi. Se on esimerkki poliittisesta vaihdannasta (political exchange). Siten yksi tapa luonneh-
tia suomalaisen tulopolitiikan historiaa on pitää sitä poliittisen vaihdannan ja tulopolitiikan osapuolten
välisen sosiaalisen pääoman historiana.
Perusedellytys poliittisen vaihdannan syntymiselle on, että kaikilla osapuolilla on riittävästi yhteistyö-
kykyä ja -halua, joka perustuu ainakin joihinkin yhteisiksi koettuihin normeihin, tavoitteisiin ja arvoi-
hin. Näitä keskinäisen luottamuksen hallitsemia perusedellytyksiä voi tiivistetysti luonnehtia vaihdan-
nan osapuolten väliseksi sosiaaliseksi pääomaksi. Sosiaalinen pääoma voidaan tulkita työmarkkina-
järjestöjen ja hallituksen väliseksi horisontaaliseksi luottamukseksi. Kirjoituksessa korostetaan tulo-
politiikan institutionaalisten rakenteiden merkitystä niin poliittisen vaihdannan kuin työmarkkinaosa-
puolten välisen sosiaalisen pääoman ylläpitämisessä.
Kirjoituksessa korostetaan myös tulopoliittisten kokonaisratkaisujen merkitystä suomalaisen hyvin-
vointivaltion kehityksessä. Esimerkiksi ansiosidonnainen työeläkejärjestelmä on pääosin kehittynyt
tulopoliittisten kokonaisratkaisujen luomassa institutionaalisessa kehikossa.
Kirjoituksessa ei tarkastella pelkästään suomalaisen tulopolitiikan historiaa, vaan myös tulopolitiikan
tulevaisuutta. Kiinnittämällä huomiota keskitettyjen tulopoliittisten kokonaisratkaisujen ja sosiaalitur-
vauudistusten väliseen vuorovaikutukseen Elinkeinoelämän keskusliiton päätös olla enää osallistu-
matta tulopoliittisten kokonaisratkaisujen tekemiseen vaikuttaa luultavasti myös poliittisen vaihdan-
nan perinteeseen työmarkkinajärjestöjen ja hallituksen välillä. Tulopoliittisten kokonaisratkaisujen ai-
kakauden päättyminen saattaa lopettaa myös poliittisen vaihdannan ja siten heikentää työmarkkina-
järjestöjen välisen sosiaalisen pääoman määrää.
INTRODUCTION
Finland is one of those countries that have a lengthy history of centrally negotiated incomes policy
agreements. This history seems to have come to an end, however. In 2007, before the next round of
wage negotiations, the Confederation of Finnish Industries, which is the peak organisation of Finnish
employers, declared that it would not take part in negotiations which aimed at achieving a
comprehensive incomes policy agreement. Consequently, that kind of agreement was not achieved
and negotiations took place at the sectoral level.
6. 5
Even though the main aim of our paper is not to consider the future of the Finnish incomes policy, our
approach enables us also to appraise the consequences of the end of centrally negotiated incomes
policy agreements. We argue that the end of making such agreements may have a larger than
commonly expected influence on Finnish society.
The main aim of our paper is to present an interpretation of the history of the Finnish incomes policy
by paying special attention to the formation of constructive relationships between the social partners
and to the importance of the incomes policy in the development of the Finnish welfare state. We
emphasise that the Finnish incomes policy agreements were much broader than ordinary wage
agreements. For example, they included major changes in earnings-related social security and in
transfer payments in general.
The incomes policy has had a decisive influence on the formation and maintenance of social capital
between the social partners. In this paper, we define social capital simply as trust between the parties
of the tripartite co-operation, and especially between trade unions and employers’ organisations. The
end of centrally negotiated incomes policy agreements may give rise to a deterioration of social
capital between the social partners because it may lead to a loosening of their relationships.
Furthermore, it may give rise to a profound change in the political and institutional framework within
which economic policy and social policy have been conducted in Finland.
Our paper is organised as follows. We first introduce the basic concepts which we utilise extensively
in our interpretation. Thereafter, we use these concepts and characterise the history of the Finnish
incomes policy at a general level. After the general consideration, we give a more detailed picture
about the history and content of the Finnish incomes policy. Thereafter, we put some of the outcomes
of the policy into a comparative perspective. Finally, we discuss the current situation and outline
alternatives for the future.
THE INCOMES POLICY AND SOCIAL CAPITAL
Currently there exists a vast and rapidly growing literature on social capital. The most commonly
used notion of social capital, based on either James S. Coleman's (1988) or Robert D. Putnam's (1993)
work, is usually connected to citizen-to-citizen trust that is created as people work in various types of
social networks and voluntary associations and that is necessary for a working democracy. However,
the literature has widened to comprise social capital between interest groups and organisations, too. In
this paper we utilise the concept organised social capital, which has been used extensively by Bo
Rothstein (2002). The concept characterises trust-related relationships between organisations.
7. 6
Even though the incomes policy is based on tripartite co-operation between three parties, the social
partners and the Government, co-operation between the social partners is its most essential part
because they represent continuity in the act of co-operation. This is the reason why we have drawn on
the literature on organised social capital.
The link from the incomes policy to social capital is not straightforward and clear. However, it can be
argued that a successful incomes policy enhances trust, or social capital, between the social partners.
On the other hand, a certain amount of trust is needed if agreements are to be achieved at all.
Countries with a history of an incomes policy are typically countries in which the general level of
social capital, whether it is defined as citizen-to-citizen trust or trust between organisations, is
relatively high. This may have reflected, among others, the homogeneity of the population and high
social cohesion.
As regards social cohesion, prerequisites for a sustained and consensual incomes and welfare policy
were weaker in Finland than in other Nordic countries. The main reasons for this were the relative
backwardness of the country, and especially the civil war, which had a very strong influence on the
collective memory of the Finnish people. Therefore the history of the Finnish incomes policy can be
regarded as a process which contributed to the accumulation of social cohesion and social capital to
the level which was achieved earlier in other Nordic countries.
THE INCOMES POLICY AND POLITICAL EXCHANGE
The Finnish incomes policy can be summarised as institutionalised tripartite co-operation between the
social partners and the Government. It is an example of political exchange between the three parties.
In political exchange, one party (the Government) is operating in the political arena exchanging
“commodities” which depend on political decisions. These commodities may be, for example,
improvements in social security, changes in taxes, and decisions improving working life.
Political exchange would not exist if the parties did not think that they benefited from it. Irrespective
of political coalitions, governments typically aim at stable and employment-enhancing economic
development. Its basic prerequisite is the absence of antagonistic social conflicts. Furthermore, wage
moderation is normally one of the main objectives that government wants to promote. For the
achievement of these objectives, the trade unions’ role has normally been decisive.
Therefore, governments have been interested in political exchange with trade unions. On the other
hand, trade unions may have been willing to take part in political exchange with governments if, in
exchange for, for example, wage moderation, they have obtained both political influence and
8. 7
commodities which require decisions made in the political arena. Some of these have been
characterised as being examples of the social wage, because they directly affect the workers’ material
living standard.
From the viewpoint of the trade union movement, political exchange and the social wage can be
regarded as one solution to the problem which Lancaster (1973, 1095) called workers’ dilemma in
capitalism: “Should they forego present consumption handing over part of total income to the
capitalists? If they do not, they will obtain no higher consumption in the future. If they do, they have
no guarantee that the capitalists will actually invest sufficient of this income to bring about the desired
level of increase.” Because wage moderation is rather in the interests of employers and governments,
governments can, within the framework of political exchange, promote wage moderation by using
social wage as a means of exchange.
The third party, the employers, may have supported political exchange because it may have advanced
both peaceful relationships in the labour market and wage moderation without major concessions on
the part of employers. As a part of political exchange, incentives for the increase of investment
activity have also been provided. Participating in the finance of social wage has been a typical
concession which employers must have made if they have been engaged in political exchange.
The basic prerequisite for the existence of political exchange is that each party has enough ability and
will to co-operate. Obviously, the will is based on some common norms, targets and values. It is hard
to see that a long-lasting political exchange could be possible without mutual trust. In characterising
these prerequisites, we use the concept of social capital.
Accordingly, it can be said that political exchange is impossible without a sufficient amount of social
capital between the parties. Social capital is a necessary but, of course, not a sufficient condition for
the emergence and existence of political exchange.
TWO VARIANTS OF POLITICAL EXCHANGE
As regards the existence of political exchange, a basic grouping of countries can be made. There are
countries where political exchange is a reality, and countries where it is not. Even though this
grouping is useful it may be too rough, because, for example, among European countries various
traditions of political exchange can be distinguished. In the literature, these traditions have been
classified by the use of some specific features of the traditions as criteria. Guido Baglioni (1987)
distinguishes between two major variants of political exchange: pluralistic political exchange and
corporatistic political exchange.
9. 8
In both types of political exchange, an obvious starting-point is that the Government recognises trade
unions as legitimate organisations in society. According to Baglioni the important common
prerequisites for the existence of political exchange of one or the other type are, for example, the
following: class compromise and the recognition of the importance of the trade union movement, the
adoption of a non-antagonistic stance on the part of the trade unions, the presence of strong and
representative trade unions, a well-established institutional framework within which an economic
policy is pursued. Despite the common features, the two variants also have considerable differences.
In pluralistic political exchange, the trade union movement pursues its political targets in co-operation
with one or more ´friendly´ political parties which act in the political arena. The trade union
movement does not operate directly in the political arena. In pluralistic political exchange, the
probability of the presence of political exchange increases when there is a pro-labour government.
Corporatist political exchange is based on trilateral co-operation within which trade union
organisations (and employers’ organisations) are an essential part of the political system, planning
and even making decisions on issues which are important for them. Because co-operation is
institutionalised, political exchange is possible even if the labour parties are not members of the
Government.
Hence, in pluralistic political exchange labour market organisations do not operate in the political
arena, while in corporatist political exchange they do. (For a more extensive discussion, see Baglioni
1987.) The differences can be summarised also by the use of the concept of social capital. In
pluralistic political exchange, social capital is not so institutionalised as it is in corporatist political
exchange.
The identification of the main characteristics of the two types of political exchange enables one to
conduct a detailed study of the nature of political exchange in various countries and in various time
periods. It should be recognised that, when Baglioni’s classification is used, not every country which
is normally regarded as a corporatist country is classified as a country with corporatist political
exchange. Baglioni takes Sweden, among some other corporatist countries, as an example of a
country which has had a period of pluralist political exchange. This is, of course, due to the strong
position the Swedish Social Democratic Party has had in Swedish political history.
10. 9
THE BEGINNINGS OF THE FINNISH INCOMES POLICY
Through the use of the key concepts, social capital, political exchange, and social wage, the history of
the Finnish incomes policy becomes not only a history of corporatist political exchange but also a
history of the formation, maintenance, and test of the social capital between the parties engaged in
political exchange. If one takes into account how many welfare-improving reforms have been
implemented as part of incomes policy agreements, the improvement of social security can be
regarded as a history of the increase in the social wage in Finland.
When one starts to periodise the history of the Finnish incomes policy, an essential change took place
much earlier than 1968, which is commonly regarded as the initial year of the Finnish incomes policy.
If one thinks that a necessary condition for the emergence of political exchange is a sufficient amount
of mutual understanding and trust, i.e. of social capital, between the parties of the exchange, the
history dates back further in Finnish political history.
In the middle of the Winter War, January 1940, the Confederation of Finnish Industries delivered a
declaration in which it recognized the Central Organisation of Finnish Trade Unions as a legitimate
partner in wage bargaining. That was part of a larger attempt to build up national unity at a critical
moment. Before the war, Finnish employers refused to have any collective bargaining with trade
unions.
This war-time compromise marked the beginning of collective wage negotiations in Finland. After the
Second World War, the declaration was deemed as one of the building blocks on which the formation
of social capital between the social partners was based. The shared war-time experiences also helped
to build trust between trade unionists and employers.
Continuous negotiations on wages and prices became a central part of economic policy in the post-
war years. However, it was not called an incomes policy before the year 1968, when the first centrally
negotiated income policy agreement was concluded. It initiated the age of the incomes policy in
Finland. The approximately twenty-year period preceding it can, however, be regarded as a
preliminary period during which preconditions for an incomes policy were evolved. Conflicts over
income distribution were continuous but manageable. Agricultural producers were also involved in
the negotiations in addition to the Government and the social partners. Obviously, the negotiations
were not yet examples of trilateral corporatist political exchange. Instead, they were a kind of crisis
management.
11. 10
FINNISH CORPORATIST POLITICAL EXCHANGE AND THE
SOCIAL WAGE
The golden years of the income policy and social reforms became possible only after certain shifts in
the political balance. The first twenty years of the post-war period (1945-1966) in Finland – unlike the
other Nordic countries, which had a clear Social Democratic hegemony at that time – were
characterized by political instability and growing divisions within the political left and the trade union
movement. For the stabilisation of the institutional framework within which the incomes policy was
conducted, the end of the disintegration of the Finnish Social Democratic Party and the Finnish trade
union movement in the late 1960s was an important prerequisite. The victory of the left-wing parties
in the Parliamentary election of 1966 strengthened the preconditions of political exchange. It started a
new era of coalition governments, which included the Social Democratic Party and the Centre Party
(the former Agrarian Union) as major partners, and reform-minded Communists as junior partners.
Corporatist political exchange and, as part of the exchange, decisions about improvements in the
social wage became common only after these changes which started the age of the incomes policy.
The golden age of the Finnish incomes policy, which lasted about twenty years following its
inauguration, enabled the realisation of an essential share of the targets the Finnish left was pursuing.
For the Finnish left and the trade union movement, centrally negotiated incomes policy agreements
provided both an essential tool for the development of the Finnish welfare state and an opportunity to
co-operate and improve trust-based relations with employers’ organisations and also with
representatives of non-left parties.
This kind of process was, of course, not unique in Europe. The strong position of the trade union
movement was a common feature in many western European countries after the Second World War.
The end of the Second World War also led to the strengthening of the political left. Trilateral co-
operation and centrally negotiated incomes policy agreements were quite common.
However, Finland differs from the other Nordic countries and many other countries in at least one
important respect: the history of the political Left is different. This may be an important reason why
the Finnish variant of political exchange became corporatist. In comparison to the Swedish Social
Democratic Party, the Finnish Social Democratic Party did not achieve such a powerful position. This
was due to the strong support of the Communist Party1
and other non-social democratic left-wing
political forces as well as the exceptionally strong position of the Agrarian Party. Social democratic
hegemony, which paved the way to pluralistic political exchange in Sweden, was not a reality in
1
In the aftermath of the Finnish Civil War (1918) the revolutionaries of the Social Democratic Party established
the Finnish Communist Party in Moscow. The Communist Party was legalised in Finland only after the Second
World War.
12. 11
Finland. In Finland the lack of political stability, which was exemplified by the disintegration of the
Left and by continuous political conflicts between the Social Democrats and the Agrarian Union,
made the development of pluralistic political exchange improbable.
In Finland, the corporatist nature of political exchange is an important reason why the social wage has
played a major role in incomes policy agreements. In the collective bargaining process, decisions on
the social wage were made simultaneously with decisions on contractual wage increases. It was a
common procedure for the social partners to first attempt to achieve a common view about the
amount of the room for overall increases in labour costs. Thereafter, they divided the room into
various components, each of which could be concluded in negotiations. In addition to contractual
wages, components consist, for example, social security contributions, which are an essential part of
the social wage, and alterations in working time. These components directly affect firms’ labour costs.
The main advantage of the simultaneity of the decisions process is that, because of the possibility of
political exchange, it can promote wage moderation.
In addition to these components, other elements could also be included in the agreements. Changes in
taxes and decisions on the improvements of public services could also be included in incomes policy
agreements. Earnings-related social insurance, the shortening of working time and the system of
public day-care are examples of reforms which have been attained mainly through corporatist political
exchange.
TRENDS IN THE SOCIAL WAGE AND SOCIAL CAPITAL
An early sign of the social wage and its strengthening was the creation of the Finnish child allowance
system in 1948. Originally, the labour market organisations tried to reach an agreement which would
guarantee a sufficient level of earnings to the male breadwinner in families with several children.
Because such an increase in fathers’ wages would have been potentially harmful to family men in the
labour market, a system of collective contribution was suggested. In the political process child
allowances were fixed to be paid to mothers from the central government budget, even though during
the transitional period employers had been obliged to pay their employees an additional sum per child
in wages. As the collective contribution was paid by employers and was taken into account in
determining the feasible wage increases, the child allowance can be regarded as the social wage.
Several other steps to increase the social wage (e.g. including the annual vacations of employees act,
an agreement on the official working time of 40 hours a week, the sickness insurance act and the
pension act) were taken at the beginning of the 1960s. These reforms merely formed a sporadic
episode of reforms during the period 1945-66 compared with the next decade, which had an
13. 12
avalanche of such reforms. However, this period was an important prerequisite for the coming era of
corporatist political exchange, because it created and strengthened the social capital between social
partners.
As part of corporatist political exchange the social wage became an important element of the
extension of the welfare state during the era of the Finnish incomes policy from 1968 onwards. In
addition to agreements on wages and salaries, comprehensive incomes policy settlements included
far-reaching social policy reforms. In particular, during the 1970s, when economic activity was tightly
regulated, incomes policy settlements included regulations of agricultural prices and incomes, price
control, housing policy and reforms for different social policy issues. (See Incomes Policy
Information Commission 1986.)
Such an extension of the social wage would not have been possible without the stop to the dissolution
of the trade union movement and the growth of union membership and the electoral victory of leftist
parties in 1966. Both the Social Democrats as a major partner and reform-minded Communists2
as a
junior partner gained growing governmental power in the coalition governments that were formed.
The new hegemony of the left and general economic regulation coerced employer organisations to
accept a trend which was not in their interests.
The new era of incomes policy settlements also meant a notable increase in the employers’ statutory
contributions to social security schemes. Such an increase was taken into account in negotiating the
level of feasible wage increases which can be considered as an element of political exchange.
Financing the higher expenditures required not only increased social security contributions, but also
an increasing, overall tax burden. However, the financing of the reforms was made easier by the
improving age structure of the population (i.e. improving dependency ratios between 1965 and 1995).
Higher taxes also meant increased redistribution of income, which favourably contributed, together
with improved benefits, to income distribution. In the mid-1960s income differentials were still large
and there was a lot of poverty in Finland. Twenty years later, in the mid-1980s, Finland had achieved
a high degree of equality and poverty was largely abolished.
In retrospect, the era of the incomes policy between 1968 and 1988 was a favourable time with regard
to the fulfilment of the objects of the trade union movement and the political left, although critical
contemporary evaluation did not always find the results good enough. For a start, centralised and
comprehensive agreements were in the preferences of the employers’ organisations. At first, trade
unions and, in particular, communists were suspicious about the incomes policy. However, the results
fulfil almost every goal of the trade union movement and the political left.
2
The Finnish Communist Party became internally divided between a reformist majority and an uncompromised
and revolutionary minority.
14. 13
This era of the incomes policy meant the inclusion of almost every stratum of society into the national
consensus on future progress in society. The compromises that were reached on the basis of the
consensus were good enough for most participants. The employers had to give up some of their goals
and accept tax increases, a solidaristic wage policy and the growth of the welfare state, but at the
same time employers were able to commit employees to the rules of the market economy. Employees
were able to fulfil several goals concerning the increase in purchasing power, leisure time and social
security. In addition, the political left successfully pursued its demand for equality, lessening the class
conflict or juxtaposition in general in society.
PENSION SECURITY REFORMS AND SOCIAL PARTNERS
Perhaps the most central element of the Finnish welfare state is the earnings-related pension scheme.
Together with the “first tier” National Pension Scheme it has gradually eliminated poverty among the
old-aged population and markedly reduced the overall income inequality. As far as the expenditures
incurred by the welfare state are concerned, the earnings-related pension scheme is the most important
transfer payment system.
Although the first national pension scheme covering the whole population was established in 1939, it
never worked well, mainly owing to the low level of contributions. The earnings-related pension
committee was established at the end of 1956 and the general private-sector act, the Employees’
Pension Act (TEL), was enacted in 1961. The labour market parties were actively involved in drawing
up the agreement. Pensions security reform, as part of earnings-related social security, was in the
interests of the trade unions, while the employers’ organisations took the offensive but participated
the inevitable reform. Through their active participation employers’ organisations were also able to
affect the outcome, and the resulting earnings-related pension scheme satisfied both parties of the
labour market.
The support of employers’ organisations for the act was sought, for example, by the suggestion that
the earnings-related pensions be handled by private insurance providers. Labour market parties would
have their representatives on the governing bodies of these providers. Furthermore, the employers got
the right to borrow the accumulated pension funds at a low regulated interest rate. Thus, accumulated
pension funds became an important assistance for investments: in order to benefit from low interest
rates a firm had to have investments. During the era of strict economic regulation the main option for
investment was the extension of domestic activities. In this way, the Finnish pension system provided
a potential solution to the problem which Lancaster (1973, 1095) called the workers’ dilemma in
capitalism: employees may be willing to accept wage moderation as the earnings-related pension
15. 14
scheme is part of the social wage, and employers may have an incentive to make domestic investment
because of favourable loan terms.
The aim was to create a sustainable, funded system. However, with a fully funded scheme there was a
fear that contributions would increase labour costs too much and therefore unnecessarily reduce
investments in the regulated economy. Therefore it was decided that the pension scheme was to enter
into force gradually and the financing of the pensions was – and still is – based partially on the pay-
as-you-go principle and on pre-funding. The next three decades after the enactment of TEL in 1961
was a period extension of the range and level of the pension benefits through centralised
comprehensive income settlements.
ECONOMIC CRISIS AND POLITICAL EXCHANGE
Finland experienced an exceptionally severe economic crisis at the beginning of the 1990s.3
The crisis
constituted a major watershed in the modern history of Finnish economy and society. More than two
decades of the expansion of the welfare state and the widening of the social wage came suddenly to
an end. The recession did not end the incomes policy or political exchange, but the content and the
function of political exchange was fundamentally transformed.
During the recession and the subsequent recovery Finnish economic policy was devoted to solving
mass unemployment through the incomes policy. During the crisis years Finland had its first centre-
right majority government in the post-war period. The Government (led by Prime Minister Esko Aho)
tried to build a new “social contract” with the social partners in order to reduce nominal wages.
Nominal wages were not reduced (as originally intended), but a historic agreement was reached: in
1991 a centralised wage agreement was settled with wage increases frozen for two years and at the
same time a portion of the employers’ social security contributions was passed to the employees’
responsibility. The effect was similar to that in the case of nominal wage reduction. One can argue
that the incomes policy response followed the traditional pattern, but this time the price was higher for
employees just because the crisis was harder than ever. In that sense, the incomes policy during the
recession cannot be considered as a political exchange but, rather, as a test for the social capital
previously accumulated and a calculated self-sacrifice of the trade union movement.
The recession changed the Finnish economy and Finnish society in several ways. Finnish enterprises
become more and more international, expansion of the welfare state ceased, and income inequality
3
Output fell by 10 per cent and unemployment increased from 3 to 17 per cent in 1991-93. See Jonung et al.
(2009).
16. 15
started to widen sharply. Skyrocketing unemployment remained the main social problem for the next
fifteen years. The economic crisis gave rise to criticism of the welfare state, the incomes policy and
economic regulation. The incomes policy, however, was not discarded. One reason for this was the
political situation.
After the centralised wage settlements for the years 1991-93 the Centre Party, led by Esko Aho,
turned against incomes policy settlements. So the Finnish Government was not interested in agreeing
to any incomes policy settlement in 1994. In addition, the attitude of the Centre Party was more or les
sticky towards the incomes policy and the trade union movement during the Parliamentary election
campaigns of 1995 and 1999. During the campaigns the party preferred a rather liberalistic “work
reform” programme designed by Esko Aho. Such a liberalisation programme did not have much
significance, because during the years 1995-2007 the Social Democratic Party was the leading party
in the Government. At that time the Social Democrats, together with other left-wing parties, leaned on
the trade union movement and were therefore deeply committed to a comprehensive incomes policy.
Thus, the incomes policy and tripartite co-operation in the labour market became the major instrument
to bring the unemployment rates down.
The crisis and its legacy (mainly a large deficit in the public finances) changed the role of the incomes
policy. Instead of extending the welfare state, the incomes policy became defensive: the current
system of social security was defended by cuts in the levels of benefit. The restructuring of the
pension system is a good example: together with trade unions and employers’ organisations the
Government increased the retirement age, reduced indexation, and introduced a coefficient for life
expectancy effects for pensions. Such a weakening of the benefits also reflected the change in the
power structures. Previously, the political exchange worked for employees by increasing the social
wage. During the 1990s the role of income tax cuts was emphasised in the political exchange for
wage moderation.
17. 16
FINLAND IN A COMPARATIVE PERSPECTIVE
The Finnish tradition of political exchange can be detected from the size and the composition of the
public sector. From the comparative perspective a similar development may be found in other
countries. Unfortunately, as far as we know, there is no classification of countries according to the
degree of political exchange. On the other hand, as Baglioni (1987) notes, the concepts of political
exchange and corporatism have been used in parallel. A variety of the orderings of countries by rank
has been proposed according to the degree of corporatism.4
However, such rankings are typically built
on the differences in the bargaining structures, as is the case with the Allen index we use here.5
With few exceptions three other Nordic countries (i.e. Denmark, Norway and Sweden) are typically
ranked higher than Finland. One obvious reason for such an observation is that corporatist structures
are a comparatively recent development in Finland, as is often acknowledged.6
Finland is ranked in
the Allen index as a country with the third highest degree of centralisation, just after Norway and
Austria and just before Sweden and Denmark. According to Baglioni (1987) Sweden and perhaps also
Norway and Denmark are the countries with a pluralist variant of political exchange, while Austria is
a country with a corporatist variant of political exchange. According to our interpretation, Finland, in
contrast to other Nordic countries, belongs to the group of countries with the latter form of political
exchange. The dividing line is not the structure of wage bargaining but rather the fact that in pluralist
political exchange the social democratic hegemony in the political arena has allowed trade unions to
separate their interest in industrial relations and in the political arena of social wage determination,
while in corporatist political exchange such a separation does not exist.7
4
There is ever growing literature on different concepts used in defining the wage-setting institutions (for a
survey see e.g. OECD 2004 or Boeri et al. 2001). For different indices see e.g. (Lijphart and Crepaz 1991 or
Mares 2006).
5
Tuovi Allen (1997) updated and extended the Calmfors-Driffill index (see Appendix). The Calmfors-Driffill
measure of the degree of centralisation of wage bargaining has been constructed as the sum of two indices: (i)
the level of co-ordination within the bargaining structure and (ii) the number of existing central union and
employer organisations.
6
For example Tarantelli (1986, 11) notes that his ranking does not count “a higher degree of neocorporatism in
Finland since the early eighties”. Similarly, in his classification of welfare state regimes Esping-Andersen (1990,
53) points out Finland’s postwar rise in the de-commodification score.
7
In particular, Baglioni (1987) emphasises the importance of the functions performed in political exchange
rather than the structure of the political exchange.
18. 17
Figure 1. General government total outlays in Finland, Denmark, Sweden and the USA between
1960 and 2005.
Note: For sources of data, see Data appendix.
To illustrate the differences in the expansion of the public sector, we show the growth of government
expenditure in Finland, Denmark, Sweden and the USA since 1960 in Figure 1. Until the mid-1970s
the size of the public sector in Finland seemed to follow a similar trend to that of the USA, which is
typically considered as a country with no political exchange at all, rather than a trend in two other
Nordic countries with social democratic hegemony. There was a dramatic increase at the beginning of
the 1990s followed by a reduction in the size of the government expenditure in Sweden and in
Finland. The huge jump merely illustrates the severity of the recession in the early 1990s. At the
beginning of the 21st century the size of the public sector is still smaller in Finland compared with
Sweden and Denmark. One possible explanation is the lack of social democratic hegemony and
therefore the nature of corporatist political exchange suggested by Baglioni (1987).
A more general interpretation of Figure 1 could be that the welfare state expansion had already ended
by the beginning of the 1980s. To illustrate this, further individual country experiences are shown in
Figure 2 for the early 1980s and the turn of the century (i.e. dashed time periods in Figure 1). The
relative size of the public sector has decreased markedly in six countries and increased in seven
countries. Of those countries with a reduced size of the public sector the United Kingdom and
Belgium are the countries in which Baglioni (1987) identified the end of political exchange and the
Netherlands was identified as a country with some strain in political exchange. Given our static
classification of countries we are not able to follow such a hypothesis in depth. Of the Nordic
20
30
40
50
60
70
80
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008*
PercentofGDP
USA SWE FIN DEN
19. 18
countries only in Finland have government total outlays a higher share of GDP at the turn of the
century than in the early 1980s. Given our structural measure of corporatism, the positive relationship
between the Allen index and the government total outlays has not changed much between the two
periods.
Figure 2. General government total outlays on the average in the early 1980s and at the turn of
the century.
Note: For sources of data, see Data appendix.
Next, we consider the structure of the public sector from the point of view of the classical
Musgravean objectives of government policy: allocation, redistribution, and stabilisation. The general
government expenditure can be grouped according to the main classic economic functions as follows:
(i) the provision of public goods; (ii) the provision of merit goods; (iii) expenditure on income
maintenance; and (iv) the provision of social infrastructure through expenditure on economic services
(see e.g. Saunders and Klau 1985).8
This breakdown of general government expenditure by function
at the turn of the century is shown in Figure 3.9
It appears that in countries with a high degree of
8
According to the Musgravean classification the provision of merit goods can be regarded as contributing to the
allocation, although with a strong element of redistribution. Government expenditure on income maintenance i.e.
social security serves the redistribution function. The provision of public goods contains a strong element of
allocation. One can roughly characterise merit goods and income maintenance as welfare state expenditures.
9
We can find statistically significant differences in the level and the composition of government expenditure. In
particular, total government outlays are positively related to the degree of corporatism. When government
expenditure is decomposed into our three categories, both the provision of merit goods and income maintenance
20
25
30
35
40
45
50
55
60
65
70
USA
CAN
NZ
UK
SPA
JAP
FRA
SWI
NET
ITA
AUS
BEL
POR
IRE
GER
DEN
SWE
FIN
AUT
NOR
Allen-index (Corporatism)
PercentofGDP
Av. 80-84 Av. 98-02 Corr. av. 80-84 Corr. av. 98-02
20. 19
corporatism provision on both merit goods and income maintenance is at a high level of GDP.10
Neither Finland nor Austria differs from the other corporatist countries. Thus, we can argue that
countries with a tradition of political exchange are committed to a high level of total welfare
spending.
Figure 3. General government expenditure by three main functions at the turn of the century.
Note: For sources of data, see Data appendix.
We have emphasised above that political exchange is about wage moderation and the social wage.
Rueda and Pontunson (2000) argue that the politics of wage moderation and the politics of wage
distribution are the opposite sides of the same coin. Thus, the argument of political exchange may be
applied to the question of curtailing wage or income distribution. In their study Bradley et al. (2003)
follow a particular line of argument: union strength reduces factor income inequality while leftist
government redistributes income by increasing the size of taxes and transfers as well as the profile of
taxes and transfers. In their empirical analysis for fourteen countries Bradley et al. (2003) found that
both union density (and/or corporatism) and a generous welfare state increased the amount of
redistribution in society. On the other hand, Moene and Wellerstein (2003) argue that the effect of
____________________
expenditure are positively and statistically significantly related to the degree of corporatism at the turn of the
century.
10
According to the ranking order of countries in the Allen-index, we have divided countries as centralised (i.e.
Norway, Austria, Finland, Sweden and Denmark), intermediate (i.e. Germany, Ireland, Portugal, Belgium,
Australia, Italy, the Netherlands, Switzerland and France) and decentralised (i.e. Japan, Spain, the UK, New
Zealand, Canada and the USA). The division of countries is, of course, more or less arbitrary.
0
5
10
15
20
25
30
USA
UK
SPA
JAP
FRA
NET
ITA
BEL
POR
IRE
GER
DEN
SWE
FIN
AUT
NOR
decentr
intermed
centr
PercentofGDP
Public goods Merit goods Inc. maintenance
21. 20
unionisation and wage bargaining institutions on welfare expenditures is indirect: unions and wage
bargaining institutions affect the distribution of income, which, in turn, affects the political support
for social insurance (Moene and Wallerstein 2003, 500).
PROSPECTS FOR THE FUTURE
For decades, corporatist political exchange has contributed to the formation and maintenance of social
capital between the parties of the exchange. This has been an essential part of the process during
which Finnish society has developed towards a consensus society. Now the Confederation of Finnish
Industries is dismantling this tradition by using the need to adjust to globalisation as the most
important reason for its decision.
Neither has the internationalisation of Finnish enterprises been not without harm for the Finnish trade
union movement. Outward foreign direct investment has reduced investment activity in Finland,
because it has decreased the financial resources that are available for domestic investment (Sauramo
2008). Therefore wage moderation may not increase domestic investment and employment any more.
In a world dominated by multinational enterprises, the previously mentioned workers’ dilemma in
Lancaster (1973) is much more difficult to solve for the trade union movement.
Therefore the vitality of the institutional framework within which the incomes policy has been
conducted is higher in a world in which internationalised firms are not multinational enterprises but
pure exporters located in the home country. This does not imply, however, that demolishing the
institutional framework would be the best way of reacting – at least not for the trade union movement.
Nonetheless, globalisation also affects the willingness of the trade union movement to maintain the
social capital which has been accumulated during the age of the incomes policy.
The decision by the Confederation of Finnish Industries can be interpreted in such a way that
employers think that they cannot benefit from comprehensive incomes policy agreements any more.
However, they have not stated explicitly in which direction they would like to move after the era of
the incomes policy.
Within our conceptual framework, the rejection of the incomes policy can be interpreted as a desire to
end corporatist political exchange, too. This desire has not been put forward explicitly, however. On
the other hand, the representatives of the Confederation of Finnish Industries have mentioned that
they are willing to continue tripartite co-operation on issues like social insurance. Yet, if wage
negotiations are separated from negotiations over social insurance, the possibilities for corporatist
political exchange are lost. This will certainly change the institutional framework within which the
Finnish welfare state has been developed.
22. 21
Even though the intentions of the employers’ side have not been explicitly stated, within our
conceptual framework two basic directions are left: towards an era of pluralistic political exchange or
towards an era without political exchange. If we think that one of the basic features of pluralistic
political exchange is a powerful left-wing (social democratic) party which operates in the political
arena, we know that currently this feature is absent. In fact, the political left is weaker today than
during the period when corporatist political exchange was developing.
Therefore, the most likely alternative might be the direction towards the era without political
exchange. For employers, this may not be a problem, because it can be thought that, because of
globalisation, wage moderation can be achieved without political exchange. This kind of appraisal
may turn out to be wrong, but it is highly likely that globalisation has strengthened the employers’
position at the cost of the trade unions.
It is obvious that in the era when the most important Finnish companies are multinational enterprises
whose link to Finland and to Finnish society is weakening, the maintenance of social cohesion may
not be so important for employers as it was earlier. This is one reason why the end of political
exchange may not be a problem for employers.
In this paper, we have emphasised one important feature of corporatist political exchange, i.e. the
institutionalisation of social capital. Therefore the end of the age of the incomes policy and corporatist
political exchange may cause a deinstitutionalisation of social capital between the social partners.
This may lead to a deterioration of trust between the social partners.
Furthermore, the end of corporatist political exchange is bound to transform the institutional
framework within which the Finnish welfare state has evolved.
DATA APPENDIX
Income maintenance (per cent of GDP) consists of general government expenditure on social
protection, source: OECD National Accounts, Volume IV, General Government Accounts - Detailed
tables.
Merit goods (per cent of GDP) consist of general government expenditure on education, health,
housing, environment, and recreation, source: OECD National Accounts, Volume IV, General
Government Accounts - Detailed tables.
Public goods (per cent of GDP) consist of general government expenditure on general public services,
defence, and public order and safety, source: OECD National Accounts, Volume IV, General
Government Accounts - Detailed tables.
Total outlays (per cent of GDP), source: OECD Economic Outlook, various issues.
23. 22
Corporatism measure; Indexation for the 1990s by Allén (1997).
prop. 1 prop. 2 prop. 3 prop. 4 prop 5 prop. 6 Sum: Rank
USA 1.00 1.00 1.00 1.00 1.00 1.00 6.00 1
CAN 1.00 1.00 1.25 1.00 1.00 1.00 6.25 2
NZ 1.25 1.25 1.25 1.00 1.00 1.00 6.75 3
UK 1.00 1.00 2.00 1.00 1.75 1.00 7.75 4
SPA 2.00 1.75 1.00 1.00 2.25 1.25 9.25 5
FRA 2.00 2.00 1.00 1.00 3.00 1.00 10.00 6
JAP 1.00 2.00 1.00 2.00 2.00 2.00 10.00 7
SWI 2.00 2.00 1.00 2.75 1.25 1.25 10.25 8
NET 2.00 2.00 1.50 2.00 2.00 1.75 11.25 9
AUS 1.75 2.00 2.00 2.00 2.00 1.75 11.50 10
ITA 2.00 2.00 2.25 2.00 2.00 1.25 11.50 11
BEL 2.00 1.75 2.75 2.00 2.00 1.25 11.75 12
POR 2.25 2.00 1.75 2.00 3.00 1.00 12.00 13
IRE 2.75 2.00 2.75 2.00 1.75 1.75 13.00 14
GER 2.25 2.25 1.75 3.00 3.00 1.75 14.00 15
DEN 2.00 2.00 3.00 2.75 3.00 2.00 14.75 16
SWE 2.25 2.00 3.00 2.75 2.75 2.25 15.00 17
FIN 2.75 2.25 3.00 2.25 3.00 2.00 15.25 18
AUT 2.25 2.25 2.50 2.75 3.00 3.00 15.75 19
NOR 3.00 2.25 2.75 2.75 3.00 3.00 16.75 20
Prop. 1: Predominant bargaining level (national, industry, firm)
Prop. 2: Number of existing negotiation parties at given bargaining level (1, 2–5, no co-ordination)
Prop. 3: Union density (high, medium, low)
Prop. 4: Employer's organization rate (high, medium, low)
Prop. 5: Collective bargaining coverage (high, medium, low)
Prop. 6: Horizontal co-ordination (high, medium, low)
REFERENCES
Allen, T. (1997). Euroopan talous- ja rahaliitto ja työmarkkinoiden neuvottelujärjestelmät. Palkansaa-
jien tutkimuslaitos. Tutkimuksia 66.
Baglioni, G. (1987). Constants and Variants in Political Exchange. Labour 1:3, 57–94.
Boeri, T., Brugiavine, A. & Calmfors, L. (2001). The Role of Unions in the Twenty-First Century.
Oxford University Press, Oxford.
Bradley, D., Huber, E., Moller, S., Nielsen, F. & Stephens, J. (2003). Distribution and Redistribution
in Postindustrial Democracies. World Politics 55:2, 193–228.
Calmfors, L. & Driffill, J. (1988). Centralization of Wage Bargaining. Economic Policy 6, 13–61.
Coleman, J. (1988). Social Capital in the Creation of Human Capital. American Journal of Sociology
94, S95–S120. Reprinted in Dasgupta, P. & Serageldin, I. (eds) Social Capital – A Multifaced
Perspective. The World Bank, Washington D.C. 13–39.
Esping-Andersen, G. (1990). The Three Worlds of Welfare Capitalism. Polity Press: Oxford.
Incomes policy information commission (1986). Incomes policy settlements in Finland 1950-1986.
The Prime Minister’s Office. Publication 1986/1. Helsinki.
24. 23
Jonung, L., Kiander, J. & Vartia, P. (eds.) (2009). The Great Financial Crisis in Finland and Sweden:
The Nordic Experience of Financial Liberalization. Edward Elgar, Cheltenham.
Lancaster, K. (1973). The Dynamic Inefficiency of Capitalism. Journal of Political Economy 81:5:
1092−1109.
Lipjhart, A. & Crepaz, M. (1991). Corporatism and Consensus Democracy in Eighteen Countries:
Conceptual and Empirical Linkages. British Journal of Political Science 235–246.
Mares, I. (2006). Taxation, Wage Bargaining, and Unemployment. Cambridge University Press,
Cambridge.
Moene, K.O. & Wallerstein, M. (2003). Earnings Inequality and Welfare Spending: A Disaggregated
Analysis. World Politics 55:2, 485–516.
OECD (2004). Employment Outlook. OECD, Paris.
Putnam, R. (1993). Making Democracy Work. Princeton University Press, Princeton.
Rothstein, B. (2002). Sweden: Social Capital in the Social Democratic State. In Putnam, R.D. (ed.)
Democracies in Flux: The Evolution of Social Capital in Contemporary Society. Oxford University
Press, Oxford.
Rueda, D. & Pontunson, J. (2000). Wage Inequality and Varieties of Capitalism. World Politics 52:3,
350-383.
Saunders, P. & Klau, F. (1985). The Role of the Public Sector. OECD. Economic Studies 4, Special
Issue.
Sauramo, P. (2008). Does outward foreign direct investment reduce domestic investment? Macro-
evidence from Finland, Labour Institute for Economic Research, Discussion paper 239, Helsinki.
Tarantelli, E. (1986). The Regulation of Inflation and Unemployment. Industrial Relations 25:1, 1–15.