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The Nature of the Finnish Competitiveness Problem


  • Maliranta, Mika
  • Vihriälä, Vesa


We assess Finland’s competitiveness in the light of various, mainly short-term indicators. It turns out that the weak export market performance over the last few years is linked to the deterioration of profitability of production in Finland. A better export and employment performance requires a decline of relative unit labour costs and an improvement of business profitability. Wage moderation would obviously serve this purpose. On the other hand, the determinants of Finland’s long-term competitiveness are quite good and maintaining and developing them should remain a key element of economic policy also in the future. In contrast, it would be a mistake to believe that Finland’s current competitiveness challenges could be solved primarily by improving management skills.

Suggested Citation

  • Maliranta, Mika & Vihriälä, Vesa, 2013. "The Nature of the Finnish Competitiveness Problem," ETLA Reports 9, The Research Institute of the Finnish Economy.
  • Handle: RePEc:rif:report:9

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    competitiveness; profitability; productivity; export performance; employment;

    JEL classification:

    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution
    • E64 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Incomes Policy; Price Policy
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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