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A guide to the Finnish labour market

Author

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  • Timo Tyrväinen

    (Bank of Finland)

Abstract

This article evaluates the fundamental characteristics of the Finnish labour market. In fact, if one wishes to verify the favourable effects of increasing »corporatism» in an empirical context, Finland should be an obvious candidate. It is hard to find an industrialized economy where the salient features of the labour markets have challged so much in such a short space of time. In this article a bargaining approach incorporating the key role ofunions in wage setting is applied. All analysis is made of basic trends in those factors which theoretical considerations imply as being relevant. The role of incomes policy is also evaluated. The explosion in the »wedge» between product wages and aftertax consumption wages appears to have contributed to employment losses in the latter half of the 1970s. It cannot, however, be blamed for the sluggish demand for labour in most of the 1980s.

Suggested Citation

  • Timo Tyrväinen, 1989. "A guide to the Finnish labour market," Finnish Economic Papers, Finnish Economic Association, vol. 2(2), pages 160-175, Autumn.
    • Handle: RePEc:fep:journl:v:2:y:1989:i:2:p:160-175
    as

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    References listed on IDEAS

    as
    1. Svejnar, Jan, 1986. "Bargaining Power, Fear of Disagreement, and Wage Settlements: Theory and Evidence from U.S. Industry," Econometrica, Econometric Society, vol. 54(5), pages 1055-1078, September.
    2. Rowlatt, Penelope A, 1987. "A Model of Wage Bargaining," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 49(4), pages 347-372, November.
    3. Oswald, A. J., 1995. "Efficient contracts are on the labour demand curve: Theory and facts," Labour Economics, Elsevier, vol. 2(1), pages 102-102, March.
    4. Manning, Alan, 1987. "An Integration of Trade Union Models in a Sequential Bargaining Framework," Economic Journal, Royal Economic Society, vol. 97(385), pages 121-139, March.
    5. Calmfors, L. & Forslund, A., 1989. "Wage Setting In Sweden," Papers 430, Stockholm - International Economic Studies.
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