Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/211514 
Year of Publication: 
1988
Series/Report no.: 
Bank of Finland Discussion Papers No. 11/1988
Publisher: 
Bank of Finland, Helsinki
Abstract: 
Finnish money markets have undergone profound changes in recent years. In particular, the transition to a more market oriented system has changed,the way domestic interest rates are formed. This paper presents and quantifies one way of describing the structure and main linkages of the current setting. Key elements of the model are the dependence of the domestic market interest rates on the foreign interest rate, an explicit formulation of the dependence of the domestic short-term market interest rate on purely domestic factors, and explicit considerations of various institutional features af the domestic money market. Empirical evidence on the formation of the domestic shor-term and long-term market interest rates as well as short-term and long-term lending rates is presented, and the results are well in accordance with the theoretical structure of the model.
Persistent Identifier of the first edition: 
ISBN: 
951-686-154-7
Document Type: 
Working Paper

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