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dc.contributor.authorGorodnichenko, Yuriyen_US
dc.contributor.authorMendoza, Enrique G.en_US
dc.contributor.authorTesar, Linda L.en_US
dc.date.accessioned2009-05-06en_US
dc.date.accessioned2010-07-07T11:50:21Z-
dc.date.available2010-07-07T11:50:21Z-
dc.date.issued2009en_US
dc.identifier.piurn:nbn:de:101:1-20090513109en_US
dc.identifier.urihttp://hdl.handle.net/10419/35312-
dc.description.abstractDuring the period 1991-93, Finland experienced the deepest economic downturn in an industrialized country since the 1930s. We argue that the culprit behind this Great Depression was the collapse of Finnish trade with the Soviet Union, because it induced a costly restructuring of the manufacturing sector and a sudden, large increase in the cost of energy. We develop and calibrate a multi-sector dynamic general equilibrium model with labor market frictions, and show that the collapse of Soviet-Finnish trade can explain key features of Finland's Great Depression. We also show that Finland's Great Depression mirrors the macroeconomic dynamics of the transition economies of Eastern Europe. These economies experienced a similar trade collapse. However, as a western democracy with developed capital markets and institutions, Finland faced none of the large institutional adjustments that other transition economies experienced. Thus, by studying the Finnish experience we isolate the adjustment costs due solely to the collapse of Soviet trade.en_US
dc.language.isoengen_US
dc.publisherIZA Bonnen_US
dc.relation.ispartofseriesIZA discussion papers 4113en_US
dc.subject.jelE32en_US
dc.subject.jelF41en_US
dc.subject.jelP2en_US
dc.subject.ddc330en_US
dc.subject.keywordBusiness cyclesen_US
dc.subject.keyworddepressionen_US
dc.subject.keywordtradeen_US
dc.subject.keywordSovieten_US
dc.subject.keywordreallocationen_US
dc.subject.keywordmulti-sector modelen_US
dc.subject.stwInternationale Wirtschaftsbeziehungenen_US
dc.subject.stwAußenwirtschaften_US
dc.subject.stwSystemtransformationen_US
dc.subject.stwWirtschaftskriseen_US
dc.subject.stwRusslanden_US
dc.subject.stwFinnlanden_US
dc.titleThe finnish great depression: from Russia with loveen_US
dc.typeWorking Paperen_US
dc.identifier.ppn599219734en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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