Nuori konservatiivi : Tuure Junnila ja hänen poliittinen toimintansa vuoteen 1956

Tuure Junnila, PhD (1910-1999) was one of Finland's most renowned conservative politicians of the post-war period. Junnila is remembered primarily as a persistent opponent of Urho Kekkonen, a long-term Member of Parliament, a conspicuous opposition member and a prolific political writer. Junnila's ideologies and political views were conservative, and he is one of the most outstanding figures in the history of the National Coalition Party. Junnila also made an extensive career outside of politics, first as an economist and then as an executive of Finland's leading commercial bank Kansallis-Osake-Pankki. The Young Conservative is a partial biography written using traditional historical research methods, which examines Junnila's personal history and his activity in public life up to 1956. The study begins by investigating Junnila's background through his childhood, school years, university studies and early professional career. It also looks at Junnila's work as an economist and practical banker. Particular attention is paid to Junnila's political work, constantly focusing on the following five often overlapping areas: (1) economic policy, (2) domestic policy, (3) foreign and security policy, (4) Junnila and Urho Kekkonen, (5) Junnila, the Coalition Party and Finnish conservatism. In his economic policy, Junnila emphasised the importance of economic stability, opposed socialisation and the growth of public expenditure, defended the free market system and private entrepreneurship, and demanded tax cuts. This policy was very popular within the Coalition Party during the early 1950s, making Junnila the leading conservative economic politician of the time. In terms of domestic policy, Junnila demanded as early as the 1940s that a "third force" should be established in Finland to counterbalance the agrarian and labour parties by uniting conservative and liberal ideologies under the same roof. Foreign and security policy is the area of Junnila's political activity which is most clearly situated after the mid-1950s. However, Junnila's early speeches and writings already show a striving towards the unconditional neutrality modelled by Switzerland and Sweden and a strong emphasis on Finland's right to internal self-determination. Junnila, as did the Coalition Party as a whole, adopted a consistently critical approach towards Urho Kekkonen between 1951 and 1956, but this attitude was not as bluntly negative and all-round antagonistic as many previous studies have implied. Junnila was one of the leading Finnish conservatives of the early 1950s and in all essence his views were analogous to the general alignment of the Coalition Party at the time: conservative in ideology and general policy, and liberal in economic policy.

The Reorganisation of Provincial Territories in Light of the Imperial Decision-Making Process : Later Roman Arabia and Tres Palaestinae as Case Studies

The dissertation examines Roman provincial administration and the phenomenon of territorial reorganisations of provinces during the Imperial period with special emphasis on the provinces of Arabia and Palaestina during the Later Roman period, i.e., from Diocletian (r. 284 305) to the accession of Phocas (602), in the light of imperial decision-making. Provinces were the basic unit of Roman rule, for centuries the only level of administration that existed between the emperor and the cities of the Empire. The significance of the territorial reorganisations that the provinces were subjected to during the Imperial period is thus of special interest. The approach to the phenomenon is threefold: firstly, attention is paid to the nature and constraints of the Roman system of provincial administration. Secondly, the phenomenon of territorial reorganisations is analysed on the macro-scale, and thirdly, a case study concerning the reorganisations of the provinces of Arabia and Palaestina is conducted. The study of the mechanisms of decision-making provides a foundation through which the collected data of all known major territorial reorganisations is interpreted. The data concerning reorganisations is also subjected to qualitative comparative analysis that provides a new perspective to the data in the form of statistical analysis that is sensitive to the complexities of individual cases. This analysis of imperial decision-making is based on a timeframe stretching from Augustus (r. 30 BC AD 14) to the accession of Phocas (602). The study identifies five distinct phases in the use of territorial reorganisations of the provinces. From Diocletian s reign there is a clear normative change that made territorial reorganisations a regular tool of administration for the decision-making elite for addressing a wide variety of qualitatively different concerns. From the beginning of the fifth century the use of territorial reorganisations rapidly diminishes. The two primary reasons for the decline in the use of reorganisations were the solidification of ecclesiastical power and interests connected to the extent of provinces, and the decline of the dioceses. The case study of Palaestina and Arabia identifies seven different territorial reorganisations from Diocletian to Phocas. Their existence not only testifies to wider imperial policies, but also shows sensitivity to local conditions and corresponds with the general picture of provincial reorganisations. The territorial reorganisations of the provinces reflect the proactive control of the Roman decision-making elite. The importance of reorganisations should be recognised more clearly as part of the normal imperial administration of the provinces and especially reflecting the functioning of dioceses.

Leibniz on Rational Decision-Making

In this study I discuss G. W. Leibniz's (1646-1716) views on rational decision-making from the standpoint of both God and man. The Divine decision takes place within creation, as God freely chooses the best from an infinite number of possible worlds. While God's choice is based on absolutely certain knowledge, human decisions on practical matters are mostly based on uncertain knowledge. However, in many respects they could be regarded as analogous in more complicated situations. In addition to giving an overview of the divine decision-making and discussing critically the criteria God favours in his choice, I provide an account of Leibniz's views on human deliberation, which includes some new ideas. One of these concerns is the importance of estimating probabilities in making decisions one estimates both the goodness of the act itself and its consequences as far as the desired good is concerned. Another idea is related to the plurality of goods in complicated decisions and the competition this may provoke. Thirdly, heuristic models are used to sketch situations under deliberation in order to help in making the decision. Combining the views of Marcelo Dascal, Jaakko Hintikka and Simo Knuuttila, I argue that Leibniz applied two kinds of models of rational decision-making to practical controversies, often without explicating the details. The more simple, traditional pair of scales model is best suited to cases in which one has to decide for or against some option, or to distribute goods among parties and strive for a compromise. What may be of more help in more complicated deliberations is the novel vectorial model, which is an instance of the general mathematical doctrine of the calculus of variations. To illustrate this distinction, I discuss some cases in which he apparently applied these models in different kinds of situation. These examples support the view that the models had a systematic value in his theory of practical rationality.

Hallinnon lehdistötiedotteiden kieli

This study seeks to answer the question of what the language of administrative press releases is like, and how and why it has changed over the past few decades. The theoretical basis of the study is provided by critical text analysis, supplemented with, e.g., the metafunction theory of Systemic Functional Grammar, the theory of poetic function, and Finnish research into syntax. The data includes 83 press releases by the City of Helsinki Public Works Department, 14 of which were written between 1979 and 1980 (old press releases), and 69 of which were written between 1998 and 1999 (new press releases). The analysis focuses on the linguistic characteristics of the releases, their changes and variation, their relation to other texts and the extra linguistic context, as well as their genre. The core research method is linguistic text analysis. It is supplemented with an analysis of the communicative environment, based on the authors' interviews and written documents. The results can be applied to the improvement of texts produced by the authorities and even by other organizations. The linguistic analysis focuses on features that transform the texts in the data making them guiding, detailed, and poetic. The releases guide the residents of the city using modal verbal expressions and performative verbs that enable the mass media to publish the guiding expressions on their own behalf as such. The guiding is more persuasive in the new press releases than in the old ones, and the new ones also include imperative clauses and verbless directives that construct direct interaction. The language of the releases is made concrete and structurally detailed by, e.g., concrete vocabulary, proper nouns and terms, as well as definitions, adverbials and comparisons, which are used specifically to present places and administrative organizations in detail. The rhetorical features in the releases include alliteration and metaphors, which are found in the new releases especially in the titles. The emphasized features are used to draw the readers' attention and to highlight the core contents of the texts. The new releases also include words that are colloquial in style, making the communicative situations less official. Structurally, the releases have changed from being letter-like to a more newsflash-like format. The changes in the releases can be explained by the development towards more professional communications and the more market-oriented ideology adopted in the communicative environment. Key words: change in administrative language, press releases, critical text analysis, linguistic text analysis

J. L. Runebergs samlade skrifter i textkritisk belysning

The Collected Works of J. L. Runeberg from the Viewpoint of Textual Scholarship The theoretical framework of this dissertation builds on textual scholarship. The dissertation explores the history of Runeberg’s publications and his relations with his publishers, from his debut and the first editions, through the editions of collected works published during the course of his life, to the later commercial editions, including the critical edition, published in 1933–2005 by the Svenska Vitterhetssamfundet (The Swedish Society for Belles Lettres) and The Svenska litteratursällskapet i Finland (The Society of Swedish Literature in Finland). The various editions of Runeberg’s collected works are situated in their respective critical traditions, from the 19th century German Ausgabe letzter Hand, to the influence of Anglo-American bibliography on Swedish textual criticism in the late 20th century. By making use of primary material previously not used for research purposes, the author is able to present a new view on Runebergian publishing history, including Runeberg’s fees and his relations with the censor authorities. There are indications that his Finnish publishers could not bear the cost of his sizable fees, that were in proportion neither with the book market in Finland nor with the numbers of copies sold. Apart from a certain body of editions the primary material is comprised of correspondences, publishing contracts, printing house invoices, as well as censor authority records. One of the conclusions drawn is that the early and detailed biography, Biografiska anteckningar om Johan Ludvig Runeberg (Biographical Notes on …) by J. E. Strömborg is not reliable in matters concerning publishing history, and that this work has been used far too uncritically. The history of the critical edition gets a chapter of its own, based on primary material in Swedish and Finnish archives. Finally, the author analyses the critical choices, made primarily in the critical edition, and uses examples from the commercial editions to study the editors’ interventions over time, from the 1850s to the 1920s. The changes to the text are usually small and subtle, but cumulative – and in some cases, crucial for the interpretation of the work. One objective of textual scholarship should be to examine the publishing history of a single work or of an author’s œuvre, and another to pay attention both to changes in a work as such and to the shifts of meaning they might entail.

Parasta ennen : Tasa-arvotyön projektitapaistuminen

This book is a study of equality work, that is, the activities which have involved the promotion of gender equality in Finland. The study focuses on the period when the public sector has become more market-oriented, and business-oriented thinking has penetrated activities that have not traditionally emphasised profit-making. I have asked about the kind of power relations that have led to equality work in Finland. In addition to marketisation, publicly funded projects, especially by the European Union, have permeated the public sector. I have analysed the effects this turn has had on the aims and activities of equality work. Despite marketisation, equality work has remained for decades, and problems related to equality have also been recognised. The question of agency is a central focus of this study. I have analysed the kind of agency that has been offered and possible in equality work. With my previous “equality project career”, I have also participated in the formation of my research subject. This study also represents a description of a researcher taking on the responsibility for being involved in the formation of her own research subject. The study data includes national and EU-level political and governmental documents as well as articles and other publications related to equality issues. The data also includes documents from 99 publicly funded equality projects. Notable research data have been drawn from research interviews with 30 people who have been engaged in equality work in different parts of Finland and who have also worked in publicly funded equality projects. As a research method, I have combined Foucault’s discourse analysis and genealogical analysis as well as deconstructive reading. Political and governmental programmes have called for equality work, such as teaching, training, research and other political influencing in order to promote the political interests of the welfare state. Alliance with the state offers the opportunity to accomplish professionalism and continuity. Although equality work has not achieved similar legitimisation compared to other public sector professions. Equality work has fulfilled the interests of welfare state despite current trends towards marketisation. Publicly and budgetary funded equality work has evolved into business-oriented projects in a situation where the project itself has become a new governing mechanism for society. To analyse this trend, I have developed the concept of projectisation. The concept refers to a form of power that has directed discussions of equality in order to be heard. On the other hand, projectisation has contributed to the visibility of problems related to equality while maintaining heteronormativity and hierarchical order of societal differences, especially of gender, as well as harnessing equality for market use, thereby becoming somewhat useful and productive. Equality has been labelled as women’s work and being something that women do and continuity of the equality work has required a complex form of competence. The persistence of problems concerning equality as well as co-operation between women and the “discourse virtuosity ” of equality work has also opened up opportunities for situational change. Key words: Equality work, project, projectisation, genealogical method, discourse analysis, deconstructive reading, heteronormativity, agency, discourse virtuosity.

Kilpailukykyvaltion koululainsäädännön rakentuminen : Suomen eduskunta ja 1990-luvun koulutuspoliittinen käänne

Finnish education policy, educational legislation and the entire education system changed significantly during the 1990s as part of a general restructuring of public administration. There has been a clear divergence from the former tradition of a system of regulation, founded on detailed legislation and the principle of equality. The new governance, which is based more on individual choice, efficiency and evaluation, emphasizes that the development of a high standard of education is a necessity in the light of global competition. This study explores the legislative process regarding education policy in the Finnish Parliament during the 1990s, and highlights in particular how the international discourse on education policies was restructured in the context of Finnish legislation. The research material consists of all the public parliamentary documents relating to education, including government proposals, minutes from the discussions in the chamber and archive material (final protocols, reports and statements) for the Committee for Education and Culture. The discourse on the process of drafting and passing education legislation is modelled on three interrelated policy technologies (market, management and performance), which are understood here as mechanisms connecting general political ideas to normative legislation. The changes in the regulation of education were part of a general public administration reform instigated during the mid 1980s. The research results will prove that during the left-right coalition cabinet of PM Harri Holkeri, new policy technologies affected the parliamentary discourse on education policy. This was particularly influenced by a change in the preconditions for the management of education that was created as a result of the numerous demands to deregulate and delegate decision-making authority to the local and school levels while rendering the whole education system more effective. At the turn of the decade, market-type mechanisms were more indirectly manifested in the forms of individuality and freedom of choice, which were reflected, for example, in proposals to “lower the hurdles” by separating general from vocational secondary education with a view to encouraging students to select courses from other educational establishments, in addition to relaxing the requirements for establishing private schools and abolishing a hundred-year-old strict national catchment-area system. Later, in the course of the 1990s, after the subjects, players, and methods of evaluation had been more precisely defined, evaluation based on performance would result in the active measurement of the attainment of set objectives. In the spring of 1991, from the outset of PM Esko Aho's right-centre coalition cabinet, the education budget suffered cutbacks as a result of a global recession and this influenced the legislative work of, and discourses in, parliament. Representatives of the parties in power regarded the recession solely as an external factor that was remote from the political arena. In their view, the education system should rise to the challenge by ensuring the efficient and innovative use of the resources available and by developing new forms of indicators for evaluating results. Representatives of the opposition opposed the cabinet’s standpoint as a result of the recession, criticized the measures taken by pointing out the harmful effect of constantly cutting the budget and argued that the government had made political capital out of the recession by using it as an opportunity to give more room to market, management and performance technologies within the Finnish education system. Criticism of the new education policy became even stronger during PM Paavo Lipponen's first “rainbow” coalition cabinet with critical views being expressed not only from the opposition but also from representatives within the government. Representatives from the left demanded legislative restrictions and the instigation of measures to relieve the presumed negative effects of market, management and performance in the name of educational equality. The new management by results steering method within the university sector and the introduction of commercial education services in compulsory education were fiercely criticized. The argument over “setting outer limits” including, for example, the demands for more detailed legislation and earmarked state subsidies was characteristic of Parliament’s legislative discourse in the latter part of the 1990s. Keywords: education policy, education legislation, Parliament of Finland

The Europeanisation of occupational health services: A study of the impact of EU policies

This study concerns Framework Directive 89/391/EEC on health and safety at work, which encouraged improvements in occupational health services (OHS) for workers in EU member states. Framework Directive 89/391/EEC originally aimed at bringing the same level of occupational health and safety to employees in both the public and private sectors in EU member states. However, the implementation of the framework directive and OHS varies widely among EU member states. Occupational health services have generally been considered an important work-related welfare benefit in EU member states. The purpose of this study was to analyse OHS within the EU context and then analyse the impact of EU policies on OHS implementation as part of the welfare state benefit. The focus is on social, health, and industrial policies within welfare state regimes as well as EU policy-making processes affecting these policies in EU member states. The research tasks were divided into four groups related to the policy, functions, targets,and actors of OHS. The questions related to policy tried to discover the role of OHS in other policies, such as health, social, and labour market policies within the EU. The questions about functions sought to describe the changes, as well as the path dependence, of OHS in EU member states after the framework directive. The questions about targets were based on the general aims of WHO and the ILO in relation to equity, solidarity, universality, and access to OHS. The questions on actors were designed to understand the variety of stakeholders interested in OHS. The actors were supranational (EU, ILO, and WHO), national (ministries, institutes, and professional organisations), and social partners (trade unions and employers organisations). The study data were collected by interviewing 92 people in 15 EU member states, including representatives of ministries, institutions, research,trade unions, employers organisations, and occupational health organisations. Other documents were collected from the Internet,databases, libraries, and conference materials for a systematic review of the policies, strategies, organisation, financing, and monitoring of OHS in EU member states. Different analytical methods were used in the data analysis. The main findings of the study can be summarised as follows. First, occupational health services is a context-dependent phenomenon, which therefore varies according to the development of the welfare state in general, and depends on each country s culture, history, economy, and politics. The views of different stakeholders in EU member states concerning the impact and possibilities of OHS to improve health vary from evidence-based opinions to the sporadic impact of OHS on occupational health. OHS as a concept is vaguely defined by the EU, whereas the ILO defines OHS content. The tasks of OHS began as preventive and protective services for workers. However, they have moved towards multidisciplinary and organisational development as well as the workplace health promotion sphere.Since 1989 OHS has developed differently in different EU member states depending on the starting position of those states, but planning and implementation are crucial phases in the process toward better OHS coverage, equity, and access. Nevertheless, the data used for the planning and legitimisation of OHS activities are mainly based on occupational health data rather than on OHS data. This makes decisions on political or policy grounds inaccurate. OHS is still an evolving concept and benefit for workers, but the Europeanisation of OHS reflects contextual changes, such as the impact of the internal market, competition, and commercialisation on OHS. Stronger cooperation and integration with health, social, and employment services would be an asset for workers, because of new epidemics, an epidemiological shift towards new risks, an ageing labour market, and changes in the labour market. Different methods and approaches are needed in order to study the results of integrated services. In the future, more detailed information will be needed about the actual impact of EU policies on OHS and decision-making processes in order to get OHS into different policies in the EU and its member states. Further results and effects of OHS processes on occupational health need to be analysed more carefully. The adoption of a variety of research strategies and a multidisciplinary approach to understand the influence of different policies on OHS in the EU and its member states would highlight the options and opportunities to improve workers occupational health. Key subject headings: Occupational health services, EU policy, policymaking,framework directive 89/391/EEC

Use of biomass fuels in the brick-making industries of Sudan: Implications for deforestation and greenhouse gas emission

The study focuses on the potential roles of the brick making industries in Sudan in deforestation and greenhouse gas emission due to the consumption of biofuels. The results were based on the observation of 25 brick making industries from three administrative regions in Sudan namely, Khartoum, Kassala and Gezira. The methodological approach followed the procedures outlined by the Intergovernmental Panel on Climate Change (IPCC). For predicting a serious deforestation scenario, it was also assumed that all of wood use for this particular purpose is from unsustainable sources. The study revealed that the total annual quantity of fuelwood consumed by the surveyed brick making industries (25) was 2,381 t dm. Accordingly, the observed total potential deforested wood was 10,624 m3, in which the total deforested round wood was 3,664 m3 and deforested branches was 6,961 m3. The study observed that a total of 2,990 t biomass fuels (fuelwood and dung cake) consumed annually by the surveyed brick making industries for brick burning. Consequently, estimated total annual emissions of greenhouse gases were 4,832 t CO2, 21 t CH4, 184 t CO, 0.15 t N20, 5 t NOX and 3.5 t NO while the total carbon released in the atmosphere was 1,318 t. Altogether, the total annual greenhouse gases emissions from biomass fuels burning was 5,046 t; of which 4,104 t from fuelwood and 943 t from dung cake burning. According to the results, due to the consumption of fuelwood in the brick making industries (3,450 units) of Sudan, the amount of wood lost from the total growing stock of wood in forests and trees in Sudan annually would be 1,466,000 m3 encompassing 505,000 m3 round wood and 961,000 m3 branches annually. By considering all categories of biofuels (fuelwood and dung cake), it was estimated that, the total emissions from all the brick making industries of Sudan would be 663,000 t CO2, 2,900 t CH4, 25,300 t CO, 20 t N2O, 720 t NOX and 470 t NO per annum, while the total carbon released in the atmosphere would be 181,000 t annually.

How to Succeed in Knowledge Transfer : Case Study of Scandinavian Alliance in Ukraine

The current study of Scandinavian multinational corporate subsidiaries in the rapidly growing Eastern European market, due to their particular organizational structure, attempts to gain some new insights into processes and potential benefits of knowledge and technology transfer. This study explores how to succeed in knowledge transfer and to become more competitive, driven by the need to improve transfer of systematic knowledge for the manufacture of product and service provisions in newly entered market. The scope of current research is exactly limited to multinational corporations, which are defined as enterprises comprising entities in two or more countries, regardless of legal forms and field of activity of those entities, and which operate under a system of decision-making permitting coherent policies and a common strategy through one or more decision-making centers. The entities are linked, by ownership, and able to exercise influence over the activities of the others; and, in particular, to share the knowledge, resources, and responsibilities with others. The research question is "How and to which extent can knowledge-transfer influence a company's technological competence and economic competitiveness?" and try to find out what particular forces and factors affect the development of subsidiary competencies; what factors influence the corporate integration and use of the subsidiary's competencies; and what may increase competitiveness of MNC pursuing leading position in entered market. The empirical part of the research was based on qualitative analyses of twenty interviews conducted among employees in Scandinavian MNC subsidiary units situated in Ukraine, using structured sequence of questions with open-ended answers. The data was investigated by comparison case analyses to literature framework. Findings indicate that a technological competence developed in one subsidiary will lead to an integration of that competence with other corporate units within the MNC. Success increasingly depends upon people's learning. The local economic area is crucial for understanding competition and industrial performance, as there seems to be a clear link between the performance of subsidiaries and the conditions prevailing in their environment. The linkage between competitive advantage and company's success is mutually dependent. Observation suggests that companies can be characterized as clusters of complementary activities such as R&D, administration, marketing, manufacturing and distribution. Study identifies barriers and obstacles in technology and knowledge transfer that is relevant for the subsidiaries' competence development. The accumulated experience can be implemented in new entered market with simple procedures, and at a low cost under specific circumstances, by cloning. The main goal is focused to support company prosperity, making more profits and sustaining an increased market share by improved product quality and/or reduced production cost of the subsidiaries through cloning approach. Keywords: multinational corporation; technology transfer; knowledge transfer; subsidiary competence; barriers and obstacles; competitive advantage; Eastern European market

Keittiömaailman matkassa 20 vuotta : Tutkimus erään keittiökalustevalmistajan johtavan markkina-aseman rakentamisesta ja säilyttämisestä

A View into the World of Kitchen: Development and retention of a leading position in the market of kitchen interiors - a case study of 20 years. This study focuses on the development of a kitchen interiors company, presently called Novart Inc., into the leading company of the industry from 1980´s to the present. The objective of the study is to describe the effects of strategic choices, the decisions of the management and the owner´s direction and control to the build up and the retaining of the leading position in the market. From theory point of view, strategic choices refer to com-pany purchases as corporate-level strategies, and business and marketing strategies. The empirical research was carried out in two phases and it is based on various company documents and records, and on the intensive interviews of seven key executives in the company. An abductive research design was utilized. The company gained the leading position in the kitchen market in Finland by company purchases, and the company has been able to retain the position. Firstly the goal was to expand to retail market and, secondly, the company has maintained the balance of supply and demand by closing the purchased production units when needed. The simultaneous use of these two strategic goals is a kind of a new observation, and the strategy may be suitable only for market leaders. During the latter part of the research period the strategy of com-pany purchases has been abandoned and the leading position in the market has been main-tained by developing systematically business and marketing capability. In the business and marketing strategies the distribution channels and the brands have been emphasized. During the research period the company has almost totally abandoned the long distribution channels and started to use its own channels built and named after the main brands. These are A la Carte, Parma and Petra. At the moment, in the beginning of the 21st century, a new distribution channel, the concept of the Kitchen World, is being built in addition to the channels mentioned above. The management´s decision making and the implementation the decisions have been well-considered. The executives emphasized the valuing of the importance of the decisions dif-ferently except the two decisions named the most important ones, i.e., the decisions to start own production of the raw material and to concentrate the business only to one company. The executive staff has also succeeded in managing crisis and threats of bankruptcy, and the company has been managed profitable. During all the four terms of ownership: Puolimatka Corporation, the Hankkija/Novera Corporation, the ownership period of the "bank", and the Nobia Corporate the ownership direction and control has been somewhat different. All the owners have paid attention to economic issues. The direction of cash flows and investments was at its strongest during the Hankkija/Novera term. For the last owner Nobia the production and marketing of the kitchen interiors has been the core business, which thus has strengthened the business and marketing capabilities of the target company of this research. A common denominator during all the four terms of ownership has been owners' trust gained by the professional skills of the management of the target company. This has lead to greater independence of the management of the company and less owners´ direction. Keywords: leading position, marketing strategy, management decisions, acquisition, corporate governance

The Impact of Emissions Trading on the Price of Electricity in Nord Pool : Market Power and Price Determination in the Nordic Electricity Market

The objective of this thesis is to find out how dominant firms in a liberalised electricity market will react when they face an increase in the level of costs due to emissions trading, and how this will effect the price of electricity. The Nordic electricity market is chosen as the setting in which to examine the question, since recent studies on the subject suggest that interaction between electricity markets and emissions trading is very much dependent on conditions specific to each market area. There is reason to believe that imperfect competition prevails in the Nordic market, thus the issue is approached through the theory of oligopolistic competition. The generation capacity available at the market, marginal cost of electricity production and seasonal levels of demand form the data based on which the dominant firms are modelled using the Cournot model of competition. The calculations are made for two levels of demand, high and low, and with several values of demand elasticity. The producers are first modelled under no carbon costs and then by adding the cost of carbon dioxide at 20€/t to those technologies subject to carbon regulation. In all cases the situation under perfect competition is determined as a comparison point for the results of the Cournot game. The results imply that the potential for market power does exist on the Nordic market, but the possibility for exercising market power depends on the demand level. In season of high demand the dominant firms may raise the price significantly above competitive levels, and the situation is aggravated when the cost of carbon dioixide is accounted for. Under low demand leves there is no difference between perfect and imperfect competition. The results are highly dependent on the price elasticity of demand.

Informational efficiency of the European Union emission allowance market

This thesis studies the informational efficiency of the European Union emission allowance (EUA) market. In an efficient market, the market price is unpredictable and profits above average are impossible in the long run. The main research problem is does the EUA price follow a random walk. The method is an econometric analysis of the price series, which includes an autocorrelation coefficient test and a variance ratio test. The results reveal that the price series is autocorrelated and therefore a nonrandom walk. In order to find out the extent of predictability, the price series is modelled with an autoregressive model. The conclusion is that the EUA price is autocorrelated only to a small degree and that the predictability cannot be used to make extra profits. The EUA market is therefore considered informationally efficient, although the price series does not fulfill the requirements of a random walk. A market review supports the conclusion, but it is clear that the maturing of the market is still in process.