Do efficient banking sectors accelerate economic growth in transition countries?

The relationship between financial sector and economic growth in transition countries has been largely ignored in the earlier empirical literature. In this paper, we analyse the finance-growth nexus using a fixed-effects panel model and unbalanced panel data from 25 transition countries during the period 1993-2000. We measure the qualitative development in the banking sectors using the margin between lending and deposit interest rates. Our second variable for the level of financial sector development is the amount of bank credit allocated to the private sector as a share of GDP. According to our results, the interest rate margin is significantly and negatively related to economic growth. This outcome is in line with theoretical models and has important policy implications. On the other hand, a rise in the amount of credit does not seem to accelerate economic growth. The main reasons behind this result could be the numerous banking crises the transition countries have experienced and the soft budget constraints that are still prevalent in many transition countries. Due to these specific characteristics the growth in credit has not always been sustainable and in some cases it may have led to a decline in growth rates.financial sector, transition economies, economic growth, panel data

Do efficient banking sectors accelerate economic growth in transition countries

The relationship between financial sector and economic growth in transition countries has been largely ignored in the earlier empirical literature. In this paper, we analyse the finance-growth nexus using a fixed-effects panel model and unbalanced panel data from 25 transition countries during the period 1993-2000. We measure the qualitative development in the banking sectors using the margin between lending and deposit interest rates. Our second variable for the level of financial sector development is the amount of bank credit allocated to the private sector as a share of GDP. According to our results, the interest rate margin is significantly and negatively related to economic growth. This outcome is in line with theoretical models and has important policy implications. On the other hand, a rise in the amount of credit does not seem to accelerate economic growth. The main reasons behind this result could be the numerous banking crises the transition countries have experienced and the soft budget constraints that are still prevalent in many transition countries. Due to these specific characteristics the growth in credit has not always been sustainable and in some cases it may have led to a decline in growth rates.financial sector; transition economies; economic growth; panel data

Monetary policy, asset prices and consumption in China

This paper studies the wealth channel in China. Using the structural vector autoregression method, we find that a loosening of China’s monetary policy indeed leads to higher asset prices, which in turn are linked to household consumption. However, the importance of the wealth channel as a part of the monetary policy transmission mechanism in China is still limited.China; monetary policy; asset prices

Reduced form models of bond portfolios

We derive simple return models for several classes of bond portfolios. With only one or two risk factors our models are able to explain most of the return variations in portfolios of fixed rate government bonds, inflation linked government bonds and investment grade corporate bonds. The underlying risk factors have natural interpretations which make the models well suited for risk management and portfolio design

Financial Systems in Transition: Could Small Actually Be Beautiful?

CEEC; Russia

Can the Chinese trade surplus be reduced through exchange rate policy?

This paper shows empirically that China’s trade balance is sensitive to fluctuations in the real effective exchange rate of the renminbi, although the size of the surplus is such that exchange rate policy alone will be unable to address the imbalance. One of the main reasons why the reduction in the trade surplus is limited is that Chinese imports are reduced with a real appreciation of the renminbi. By estimating bilateral import equations, we find that it is imports from other Southeast Asian countries which fall. This result reflects the vertical integration of Southeast Asia with China through the 'Asian production network'. We find, in turn, that imports from Germany – which serve China’s domestic demand – behave as one would expect, ie they increase with renminbi real appreciation. All in all, our results raise concerns on the impact of renminbi appreciation on Southeast Asia even if regional currencies do not follow the renminbi’s upward trajectory.China; trade; exports; real exchange rate

On diversity effects of alternative agricultural policy reforms in Finland: An agricultural sector modelling approach

The aim of this study is to predict diversity effects of agricultural policy reforms in which direct aid payments are disconnected from production, and compare the outcomes with effects of such a policy in which CAP support is coupled. The study employs the dynamic regional sector model of Finnish agriculture. The sector model predicts regional land use, stocking densities, pesticide application areas, and nutrient balances

McCallum rule and Chinese monetary policy

This paper evaluates the usefulness of a McCallum monetary policy rule based on money supply for maintaining price stability in mainland China. We examine whether excess money relative to rulebased values provides information that improves the forecasting of price developments. The results suggest that our monetary variable helps in predicting both consumer and corporate goods price inflation, but the results for consumer prices depend on the forecasting period. Nevertheless, growth of the Chinese monetary base has tracked the McCallum rule quite closely. Moreover, results using a structural vector autoregression suggest that our measure of excess money supply could be used to identify monetary policy shocks in the Chinese economy.McCallum rule; monetary policy; China

Pelastusmuodostelmien resurssit Keski-Uudenmaan pelastusalueella ilmaliikenteen onnettomuusvaara–tilanteiden aikana Helsinki-Vantaan lentoasemalla vuosina 2015 – 2016

Työssä on tutkittu vuosien 2015-2016 tapahtuneiden Helsinki-Vantaan lentoaseman ilmaliikenteen onnettomuusvaara -tilanteiden aikoina pelastusalueella olevien sammutus- ja pelastusyksiköiden tilatieto eli status. Jos vaaratilanne olisi päätynyt mahdolliseen onnettomuuteen, on tärkeää tietää etukäteen oletusarvoisesti varattujen resurssien realistinen status. Sen tiedon pohjalta voidaan suunnitella korvaavia järjestelmiä alueen pelastusresurssien paikkaamiseksi. Menetelmällinen ratkaisu oli tutkia kaikki ilmaliikenteen onnettomuusvaara -tilanteet PRONTO järjestelmästä. Sen avulla selvitettiin yksiköiden status. Apuna käytettiin myös PRONTO:n karttapohjaa etäisyyksien mittaamiseksi. Kehittämistehtävänä oli kehittää suosituksia, jotka takaavat nopean ja tehokkaan pelastustoiminnan aloittamisen mahdollisessa ilmaliikenteen onnettomuustapauksessa. Tavoitteena on paikata vajeita ennakkoon pelastusalueella. Viitekehyksenä toimivat mm. Pelastuslaki, EU OPS (Euroopan Unionin asetukset), ”Pelastus-toiminnan johtamisen yleisohje – PelToimJohtYlOhje” (HIKLU –pelastuslaitokset) sekä ”Toiminta Ilmaliikenteen onnettomuus- ja vaaratilanteissa Helsinki-Vantaan lentoasemalla ja sen lähialueilla”-ohje (HIKLU –pelastuslaitokset). Keskeinen tulos tutkimuksesta oli se, että joka neljännessä tilanteessa, jossa pelastustoimen resursseja olisi tarvittu mahdollisessa onnettomuustilanteessa, ei ollut saatavilla vastesuunnittelun mukaisesti.In this thesis, the status of the rescue and extinguishing units at Helsinki-Vantaa airport in 2015-2016 was investigated, and the focus was on situations, where there has been a risk of air traffic accidents. If a hazardous situation results in a potential accident, it is important to know in advance the realistic status of the resources allocated by default. On the basis of that information, it is possible to design substitute systems for the resources of rescue areas in the region. The methodological solution was to investigate all the aviation accident hazards in 2015 – 2016 in the PRONTO system. The PRONTO mapbase was used to investigate the status of rescue units, as well as to measure distances. The development task was to create proposals that ensure fast and efficient emergency operations in the event of an aviation accident. The aim was to cover the deficits in the rescue area. The reference framework in this thesis is, for example, Rescue Act, EU OPS, a manual on managing rescue operations and a manual on operating in accidents and emergencies in air traffic by the Rescue Departments of the Metropolitan area. A key result of the study was that in every fourth case, where rescue resources would have been needed in a potential accident situation, they were not available according to the emergency response plans

Total ankle replacement : Clinical, radiological, and biochemical assessment with special reference to osteolysis

End-stage ankle arthritis may be managed surgically with either ankle fusion or total ankle replacement (TAR). The results of total ankle replacement have improved over the recent decades, but challenges remain. Peri-implant osteolysis has been major problem, as it compromises the stability of the implant components and can lead to aseptic loosening and implant failure. For this retrospective study, 164 ankles (34 Scandinavian Total Ankle Replacement (STAR) and 130 Ankle Evolutive System (AES)) operated on in single institution during 1997–2008 were followed clinically and radiologically. Histological samples were collected from ankles revised due to periprosthetic osteolysis. Analysis from the data covering the years 1997–2006 of the Finnish Arthroplasty Registry was conducted. The peri-implant osteolysis was quite common in the AES total ankle implants: 70% of the ankles exhibited osteolysis at the latest follow-up. Dual-coating of the implant was associated with a 3.1-fold risk of osteolysis and of significantly earlier development of osteolysis compared to single-coating. Histology revealed a foreign-body reaction characterized by extensive soft and bone tissue necrosis. RANK/RANKL-mediated osteoclast and multinuclear foreign body giant cells contributed to peri-implant osteolysis, and there was increased expression of danger signals in the peri-implant tissues, suggesting an auto-inflammation mechanism behind osteolysis. The annual incidence of TAR according to the Finnish Arthroplasty Registry was 1.5 per 105 inhabitants and overall implant survival was 83% at 5 years when any revision was the end point. The most common reasons for revision were aseptic loosening (39%) and instability (39%). In the registry study, there was no difference in the survival rates between the STAR and AES designs, nor was there any association between age, gender, diagnosis, or hospital volume and TAR survival. The survival of the STAR implant was satisfactory, 93.8% (95% CI 77.5% to 98.4%) at 5 years, and 87.2% (95% CI 69.4% to 95.0%) at 10 and 15 years. There was no statistically significant association between implant survival and patient age, gender, BMI, or diagnosis. The overall rate of revisions was 44%, which includes all postoperative revisions for osteolysis, component and insert exchanges, and conversions to arthrodesis. The survival of the AES implant was strongly affected by osteolysis and malalignment, and inferior compared to previously published results. The 5-year survival was 87.3% (95% CI 80.0% to 92.0%), and the 10-year survival 74.9% (95% CI 65.4% to 82.2%). Postoperative alignment of ≥10º of varus predicted a poorer outcome and was statistically significant for implant survival (p=0.0005). The revision rate for all revisions was 57% including all postoperative revisions for osteolysis, component exchanges, and conversions to arthrodesis. Osteolysis was the main reason for revisions and failure. The survival of the STAR total ankle replacement was satisfactory in the long-term, but the results of the AES total ankle implants were strongly influenced by aggressive and early-emerging osteolysis. Future studies should focus on examining the mechanism behind the osteolytic process in TAR to avoid similar problems for implant development in the future.Nilkan tekonivel: Kliininen, radiologinen ja biokemiallinen seuranta Ylemmän nilkkanivelen loppuvaiheen nivelrikkoa voidaan hoitaa nilkan luudutus- tai tekonivelleikkauksella. Viime parinkymmenen vuoden aikana nilkan tekonivelleikkaus tuhoutuneen ylemmän nilkkanivelen hoidossa on yleistynyt. Hankalin nilkan tekonivelen komplikaatio on viime vuosien aikana ollut osteolyysi eli luun liukeneminen tekonivelen ympäriltä, joka saattaa johtaa tekonivelen irtoamiseen. Tässä takautuvassa tutkimuksessa analysoitiin yhdessä sairaalassa laitetun 164 nilkan tekonivelen (34 Scandinavian Total Ankle Replacement (STAR) ja 130 Ankle Evolutive System (AES)) kliiniset ja radiologiset seurantatulokset. Kudosnäytteet saatiin nilkoista, jotka oli jouduttu uusintaleikkaamaan osteolyysin vuoksi. Lisäksi analysoitiin Suomen Endoproteesirekisterin dataa ajalta 1997–2006 koskien nilkan tekoniveliä. Osteolyysin määrä AES-nilkan tekonivelissä oli korkea, 70 % nilkoista viimeksi tehdyn analyysin mukaan. AES-tekonivelen kaksoispinnoite aiheutti yli kolminkertaisen riskin osteolyysin kehittymiselle sekä merkitsevästi aikaisemmin ilmaantuvaa osteolyysiä yksinkertaiseen pinnoitteeseen verrattuna. Mikroskooppitutkimuksessa todettiin vierasesinereaktio ja runsaasti kudoskuoliota. Suomen Endoproteesirekisteriin perustuvassa tutkimuksessa nilkan tekonivelen vuosittainen ilmaantuvuus oli 1,5 tapausta 100.000 asukasta kohti. Nilkkaproteesin kokonaispysyvyys oli 83 % 5 vuoden aikana, kun päätetapahtumana oli mikä tahansa uusintaleikkaus. Uusintaleikkauksen yleisimmät syyt olivat aseptinen irtoaminen (39 %) ja epävakaus (39 %). Rekisteritutkimuksen mukaan implanttimallilla, potilaan iällä, sukupuolella, diagnoosilla tai sairaalan leikkausvolyymilla ei ollut yhteyttä implantin pysyvyyteen. STAR-nilkan tekonivelen pysyvyyden todettiin olevan erittäin hyvä, 93.8 % viiden vuoden ja 87,2 % kymmenen ja viidentoista vuoden aikana. Potilan iällä, sukupuolella, painoindeksillä tai diagnoosilla ei todettu yhteyttä tekonivelen pysyvyyteen. Uusintaleikkausten määrä oli 44 % sisältäen kaikki uusintaleikkaukset osteolyysin vuoksi, komponenttien vaihdot ja tekonivelen vaihdot luudutukseen. AES-nilkan tekonivelen pysyvyys oli huonoa, ja siihen vaikuttivat sekä runsas osteolyysin määrä että nilkan virheasento. Viiden vuoden pysyvyys oli 87.3 % ja kymmenen vuoden 74.9 %. Leikkauksen jälkeisen nilkan virhelinjauksen todettiin ennustavan tilastollisesti merkitsevästi huonompaa tulosta. Uusintaleikkausten määrä oli 57 % sisältäen kaikki uusintaleikkaukset osteolyysin vuoksi, komponenttien vaihdot ja tekonivelen vaihdot luudutukseen. Osteolyysi aiheutti suurimman osan uusintaleikkauksista ja epäonnistumisista. STAR-tekonivelen pysyvyys oli hyvä pitkällä aikavälillä, mutta AES-tekonivelen tuloksia huononsi merkitsevästi erittäin aikaisessa vaiheessa ilmaantunut aggressiivinen osteolyysi. Tulevaisuudessa tutkimusten tulisi keskittyä selvittämään tarkemmin osteolyysin mekanismeja, jotta vastaavat ongelmat voitaisiin jatkossa välttää tekonivelien kehitystyössä.Siirretty Doriast