The Coherence between Sovereign Wealth Funds and Fiscal and Monetary Policies: the Norwegian Case (2001-2017)

Öz

This article seeks the link between the macroeconomic challenges faced by oil exporting economies and the use of public policies meant to mitigate the harmful effects of the dependence on hydrocarbon exports through the study of the Norwegian case. The main goal is to determine to what extent the coordination between the Norwegian sovereign wealth fund and countercyclical fiscal and monetary policies contributed to the mitigation of economic cycles triggered out by oil price volatility between 2001 and 2017.

Anahtar Kelimeler

• Sovereign Wealth Funds,Norway,Oil,Fiscal Policy,Monetary Policy

Kaynakça

1. Alesina, A.; Tabellini, T.; and Campante, F.R. (2008): “Why is Fiscal Policy Often Procyclical?” Journal of European Economic Association 6 (5), 1006-1036.
2. Alsweilem, K.A.; Cummine, A.; Rietveld, M.; and Tweedie, K. (2015): Sovereign Investor Models: Institutions and Policies for Managing Sovereign Wealth. Belfer Center for Science and International Affairs, Cambridge, Harvard Kennedy School.
3. Balding, C. (2012): Sovereign Wealth Funds: The New Intersection of Money and Politics. Oxford: Oxford University Press.
4. Bergman, M.; Juel, S.; and Steigum, E. (2009): Norges Bank Watch 2009. Centre for Monetary Economics, Oslo, BI Norwegian Business School.
5. Bjerkholt, O. and Nicolescu, I. (2004): “Fiscal Rules for Economies with Non-Renewable Resources: Norway and Venezuela”. Kopits, G. (ed.): Rules-Based Fiscal Policy in Emerging Markets: Background, Analysis and Prospects (pp. 164-179). Basingstoke: Pelgrave Macmillan.
6. Bjønnes, G.H.; Holden, S., Rime, D. and Solheim, H.O.A. (2014): “Large vs. Small Players: A Closer Look at the Dynamics of Speculative Attacks”. The Scandinavian Journal of Economics, 116 (2), 506-538.
7. Bjørnland, H.C.; Ekeli, T.; Geraats, P.M.; and Leitemo, K. (2004): Norges Bank Watch 2004. Centre for Monetary Economics, Oslo, BI Norwegian Business School.
8. Bjørnland, H.C.; Clarida, R.; Holvik, E.; and Steigum, E. (2010): Norges Bank Watch 2010. Centre for Monetary Economics, Oslo, BI Norwegian Business School.

9. Buendía, L and Palazuelos, E. (2014): “Economic Growth and Welfare State: a Case Study of Sweden”. Cambridge Journal of Economics 4, 761-778.
10. Collier, P.; van der Ploeg, F.; and Venables, A. (2009): “Managing Resource Revenues in Developing Economies”. IMF Staff Papers, 57, Washington.
11. Corden, W. M. and Neary, P. (1982): “Booming Sector and De-Industrialization in a Small Open Economy”. The Economic Journal, 92 (368), 825-848.
12. ECB (2018): Monetary Policy. Available from: https://www.ecb.europa.eu/ecb/tasks/monpol/html/index.en.html . [Accessed: 09.07.2018]
13. Ekman, I. (2005): “Trouble Brewing in Oil-Rich Norway”. International Herald Tribune, 18 November, New York.
14. Gjedrem, S. (1999): Challenges to Economic Policy. Speech at the Annual Foreign Exchange Seminar, organized by The Association of Norwegian Economists, Gausdal, 28.01.1999. Available from: http://www.bis.org/review/r990129a.pdf . [Accessed: 09.06.2018]
15. Goodfriend, M.; Mork, K.A.; and Söderström, U. (2007): Norges Bank Watch 2007. Centre for Monetary Economics, Oslo, BI Norwegian Business School.
16. Gylfason, T. (1990): “Exchange Rate Policy, Inflation and Unemployment: The Experience of the Nordic EFTA Countries”. Institute for International Economic Studies Seminar Paper 459, Stockholm.
17. Hartwick, J.M. (1977): “Intergenerational equity and investing rents from exhaustible resources”. American Economic Review, 67 (5), 972-974.
18. Husain, A.M.; Tazhibayeva, K. and Ter-Martirosyan, A. (2008): “Fiscal Policy and Economic Cycles in Oil-Exporting Countries”. IMF Working Paper No. 08/253, Washington.
19. Hvinden, E.C. and Nordbø, E.W. (2016): “The Fall in Oil Prices and the Labour Market”. Norges Bank Economic Commentaries 7/2016, Oslo. IMF (several years): Norway-Staff Report for Article IV Consultation. Washington. Available from: https://www.imf.org/en/countries/nor?selectedfilters=Article%20IV%20Staff%20Reports#whatsnew [Accessed: 09.08.2018].
20. Iversen, T. (1996): “Power, Flexibility, and the Brakedown of Centralized Wage Bargaining: Denmark and Sweden in Comparative Perspective”. Comparative Politics, 28, 399-436.
21. Kleivset, C. (2012): “From a Fixed Exchange Rate Regime to Inflation Targeting. A Documentation Paper on Norges Bank and Monetary Policy, 1992-2001”. Norges Bank Working Paper 2012/13. Oslo.
22. Looney, R. (2008): “Currency Conundrums in the Gulf”. The Middle East Institute Policy Brief, 6, Washington.
23. Lotfi-Heravi, M.M. (2015): Real Exchange Rate in Commodity Exporting Countries. Doctoral Thesis. Glasgow: University of Glasgow.
24. Magud, N. and Sosa, S. (2010): “When and Why Worry about Real Exchange Rate Appreciation? The Missing Link between Dutch Disease and Growth”. IMF Working Paper, 271, Washington.
25. Mishkin, F. S. and Schmidt-Hebbel, K. (2001): “One decade of inflation targeting: what do we know and what do we need to know”. National Bureau of Economic Research Working Paper W8397, Cambridge.
26. Mjøset, L. (1989): “Norway’s Full-Emloyment Oil Economy - Flexible Adjustment or Paralysing Rigidities?” Scandinavian Political Studies 12 (4), 313-341.
27. Mjøset, L. and Cappelen, Å. (2011): “The Integration of the Norwegian Oil Economy into the World Economy”. En Mjøset (ed.): The Nordic Varieties of Capitalism. Bingley: Emerald Group.
28. Moses, J. (1994): “Abdication from National Policy Autonomy: What’s Left to Leave?” Politics and Society 22 (2), 125-148.
29. Mulder, N. (2006): “Aprovechar el auge exportador de productos básicos evitando la enfermedad holandesa”. CEPAL Serie Comercio Internacional, 80, Santiago de Chile.
30. NBIM (2018): Annual Report 2017. Available from: https://www.nbim.no/en/transparency/reports/ . [Accessed: 27.07.2018]
31. Noreng, Ø. (1980): The Oil Industry and Government Strategy in the North Sea. Boulder: Croom Helm.
32. Norges Bank (2016): Act of 24 May 1985 relating to Norges Bank and the Monetary System. Available from: http://www.norges-bank.no/en/about/mandate-and-core-responsibilities/legislation/norges-bank-act/ . [Accessed: 27.06.2017]
33. Norges Bank (2017): “Experience with the Monetary Policy Framework in Norway since 2001”. Norges Bank Papers 1/2017. Accessible from: http://static.norges-bank.no/contentassets/18ffcd13128a4badb15e27f144362a3a/nb_papers_1_2017.pdf?v=03/09/2017123525&ft=.pdf . [Accessed: 27.08.2018]
34. Norges Bank (2018a): Monetary Policy in Norway. Available from: http://www.norges-bank.no/en/about/Mandate-and-core-responsibilities/Monetary-policy-in-Norway/ . [Accessed: 27.08.2018]
35. Norges Bank (2018b): Modernisation of the Regulation on Monetary Policy. Available from: https://www.norges-bank.no/en/Published/Submissions/2018/18-02-28-submission/ . [Accessed: 27.08.2018]
36. Norwegian Government (2001): Report no. 29 to the Storting (2000-2001) Guidelines for economic policy. Available from: https://www.regjeringen.no/globalassets/upload/kilde/fin/red/2005/0013/ddd/pdfv/260472-pmk_rap.pdf . [Accessed: 09.06.2018]
37. Norwegian Government (2015): “Fiscal Policy in an Oil Economy”. Official Norwegian Reports NOU 2015:9, Chapter 1, Oslo. Available from: https://www.regjeringen.no/contentassets/ba20a11b21e4468981fecf4ecbe2418c/en-gb/pdfs/nou201520150009000engpdfs.pdf . [Accessed: 20.05.2017]Norwegian Ministry of Finance (several years): The National Budget. Available from: https://www.regjeringen.no/en/topics/the-economy/the-national-budget/id1437/ [Accessed: 22.07.2018]
38. Norwegian Ministry of Finance (2018): The Government Pension Fund. Available from: https://www.regjeringen.no/en/topics/the-economy/the-government-pension-fund/id1441/ [Accessed: 20.07.2018]
39. Obstfeld, M; Shambaugh, J. and Taylor, A.M. (2005): “The Trilemma in History: Tradeoffs among Exchange Rates, Monetary Policies, and Capital Mobility”. Review of Economics and Statistics 3, 423-438.
40. Olsen, Ø. (2014). Economic Perspectives. Address by Governor Øystein Olsen to the Supervisory Council of Norges Bank and invited guests on Thursday 13 February 2014, Oslo. Available from: http://www.norges-bank.no/pages/98855/Annual_address_governor_olsen_14.pdf . [Accessed: 20.05.2017]
41. Revå, T. (2010): How did the Inflation Targeting Policy of Norges Bank Impact the 2008 Financial Crisis? Master’s thesis. Bergen, Norwegian School of Economics (NHH).
42. Setser, B. (2007): “The Case for Exchange Rate Flexibility in Oil-Exporting Economies”. Policy Brief PB07-8, Peterson Institute for International Economics, Washington.
43. Skånland, H. (1999): “Norway and the Euro”. BI Centre for Monetary Economics WP 8/1999. Oslo. SSB (several years): Economic Survey. Available from: https://www.ssb.no/a/histstat/es/ . [Accessed: 15.05.2017]
44. Steigum, E. and Thøgersen, Ø. (2013): “A Crisis not Wasted –Insitutional and Structural Reforms Behind Norway’s Strong Macroeconomic Performance”. NHH SAM 18 2013, Bergen.
45. Svensson, L.E.O. (1997): “Exchange Rate Target or Inflation Target for Norway?” Christiansen, A.B. and Qvigstad, J.F. (eds.): Choosing a Monetary Policy Target (pp. 120-138). Oslo: Universitetsforlaget.
46. Torvik, R. (2004): “The Real Exchange Rate and Phasing In of Oil Revenues”. Norges Bank Occasional Papers 32, 15-30. Oslo.Vázquez Vicente, G. (2007): “La crisis del Sistema Monetario Europeo (1992-1993): ¿crisis financiera o crisis de políticas de cooperación monetaria?” Revista Universitaria Europea, 6, 33-82.
47. Wallerstein, M. and Golden, M. (2000): “Postwar wage setting in the Nordic countries”. Iversen, T.¸Pontusson, J.; and Soskice, D. (eds.): Unions, Employers, and Central Banks: Macroeconomic Coordination and Institutional Change in Social Market Economies (pp. 107-136). Cambridge: Cambridge University Press.
48. Bank of England (2018): Monetary Policy Committee Decisions, Minutes and Forecasts. Available from: http://www.bankofengland.co.uk/monetarypolicy/Pages/decisions.aspx . [Accessed: 16.08.2018]
49. ECB (2018): Key ECB Interest Rates. Available from: https://www.ecb.europa.eu/stats/monetary/rates/html/index.en.html . [Accessed: 16.08.2018]
50. EIA (2018): Short-term Energy Outlook. Available from: http://www.eia.gov/forecasts/steo/. [Accessed: 16.07.2018]
51. Eurostat (2018): Eurostat Database. Available from: http://ec.europa.eu/eurostat/data/database . [Accessed: 16.08.2018]
52. NBIM (2018): The Fund. Available from: https://www.nbim.no/en/the-fund/return-on-the-fund/. [Accessed: 15.07.2018]
53. Norges Bank (2018): Norges Bank Statistics. Available from: http://www.norges-bank.no/en/Statistics/ . [Accessed: 15.07.2018]
54. Norskpetroleum (2018): Everything you need to know about Norwegian petroleum activities. Available from: http://www.norskpetroleum.no/en/ . [Accessed: 16.07.2018]
55. OECD (2018): OECD Data. Available from: https://data.oecd.org/ . [Accessed: 30.07.2018]
56. Sovereign Wealth Fund Institute (2018): Sovereign Wealth Fund Rankings.Available from: http://www.swfinstitute.org/sovereign-wealth-fund-rankings/ . [Accessed: 14.07.2018]
57. SSB (2018): Statbank. Available from: http://www.ssb.no/en/statistikkbanken . [Accessed: 16.08.2018]
58. Swedish Central Bank (2018): Interest and Exchange Rates. Available from: http://www.riksbank.se/en/Interest-and-exchange-rates/ . [Accessed: 16.08.2018]