Vol. 28, No. 1

Jaakko Pehkonen, Sampo Pehkonen and Matthias Strifler:

Wage Effects of Firm Size: Evidence from Linked Employer-Employee Panel (pp. 1–9)


This study explores the relationship between wages and firm size using large registered data and different identification strategies. We find that the effect of firm size on wages is negligible when worker and firm characteristics are accounted for. The findings are robust across identification strategies and numerous covariates. The findings are also consistent with the view that coordinated wage-setting systems narrow wage distributions.

(JEL: J31)

Caroline Flodberg and Pär Österholm:

A Statistical Analysis of Revisions of Swedish National Accounts Data* (pp. 10–33)


In this paper, we study revisions of Swedish national accounts data. Three aspects of the revisions are considered: volatility, unbiasedness and forecast efficiency. Our results indicate that the properties of the revisions are more problematic for the production side than for the expenditure side. The high volatility of the revisions on the production side indicates that it is generally difficult to make clear cut statements concerning production across industries within the business sector based on the initial data release; it is also likely to make forecasting more difficult.

(JEL: E01)

Elina Berghäll:

Knowledge Spillovers, the Technology Frontier and High-Tech FDI – Evidence from Finland* (pp. 34–49)


The link between foreign direct investment (FDI) and the technology frontier is strong in the theoretical and empirical literature, particularly for high-tech multinational corporations. Policymakers aiming to harness local high-tech clusters therefore tend to cherish high-tech inward FDI. It is not clear whether they should. With an unbalanced panel of Finnish ICT manufacturing firms for 1993–2003, I identify the direction of knowledge spillovers by comparing the technical efficiencies of foreign and indigenous firms with DEA and order-m methodology. When knowledge spillovers flow predominantly to foreign firms, innovation policy seeking to accelerate them may accelerate the net loss of strategic assets.

(JEL: O47, O33, O52, L63)

Hovick Shahnazarian, Martin Solberger and Erik Spånberg:

Forecasting and Analysing Corporate Tax Revenues in Sweden Using Bayesian VAR Models* (pp. 50–74)


Corporate tax revenue forecasts are important for governmental agencies, but are complicated to achieve with high precision and generally also difficult to connect to governments’ macroeconomic forecasts. This paper proposes a solution to these problems by decomposing corporate tax revenues and connecting the components to different determinants using Bayesian VAR models. Applied to Sweden, we find that most of the variation in forecasting errors of net operating surplus and net business income are attributable to shocks in factors identified in the literature, and that the forecasting performance is improved by conditioning on the macroeconomic development.

(JEL: C53, H25, H68)

Finnish Economic Papers 1/2017