FINLAND AND EURO – WAS IT WORTH IT?

ABSTRACT

This dissertation examines Finland and euro and Finland’s economic performance since the country joined the common currency area. This was accomplished through regression modelling where the data used was GDP, exports and imports and also the exchange and unemployment rates. The data analysis was based on the assumption that some or all of the mentioned have an impact on Finland’s GDP. The results show that the only factor of these is exports that has a huge impact on the level of GDP. The other factors have some or no straight effect at all, or the factors should be included in the model with other factors to get significant results. The dissertation also focuses on the optimum currency area theory and how it has actualised in Finland since the 1990’s. Facts and figures show that there hasn’t been remarkably high rising in the level of labor or capital movement or noteworthy rise in trading among EU countries. The results of the examination show that the current economic problems Finland is facing today cannot be explained only (if at all) by euro. Most likely Finland would be in trouble even if they had their own currency.