In June of 1946 ”Finland’s central organizations of production” including the Finnish Association of Industry, the Central Association of Finnish Woodworking Industries and the Confederation of Finnish Employers (STK) founded the predecessor of the Research Institute of the Finnish Economy (ETLA), called the Economic Research Centre, which began its operations on August 1st that same year. Post-war political and economic transformation and a lack of basic information concerning the economy created a new need for economic research.
Initially, research focused on basic surveys and studies of current topics. Among the first tasks was a report on the extent and forms of social activity in industry. Similarly, possibilities to strengthen the labour supply to facilitate reconstruction and war reparations were examined.
Relatively soon the focus of operations centred on long-term studies. Their topics have varied considerably, but long-term economic growth, above all productivity growth and examination of the factors influencing it have acted as a common thread. In this context, the structural change of production, economic integration, competitiveness, skills relating to the labour force, innovation activity, labour market activities, public finances and especially the sustainability of the pension system have been researched. Macro-economic policy issues have also been examined extensively from time to time. Throughout its existence ETLA has sought to apply advanced research methods to practical problems.
Monitoring the economic situation and forecasting its development has been one of the tasks of the institute right from the beginning. Operations became more systematic in the early 1970s, when the institute began to produce regular economic forecasts. At the same time the forecasts began to make use of econometric methods.
The 1970s also marked a major change in the activities of the institution. The financial base expanded in 1971 with e.g. financial institutions becoming members of the supporting association. Simultaneously, the name was changed to the Research Institute of the Finnish Economy. The resources were also strengthened.
The next big turning point came in the early 2000s. Business associations and activities funded by them were rationalized. At this point, ETLA and the Finnish Business and Policy Forum EVA received a joint board of directors, managing director and financial administration. EVA also moved into joint premises with ETLA.
The newly formed Confederation of Finnish Industries, Confederation of Finnish Industry and Employers (TT) Foundation and the Employers’ Confederation of Service Industries, which has since ceased operations, remained members of the supporting association of ETLA. The supporting association’s board structure changed so that instead of having a large number of representatives from various organizations, key actors in the business sector and persons with a strong research background began to be elected into the board.
Alongside the basic funding provided by the supporting association, the importance of project-specific financing has increased since the recession of the 1990s. Its share has been deliberately kept high in the 2000s.
The number of staff members at the institute has grown from 5-6 in the beginning to about 45 in 2016. At times there has been even more staff, over 60 at the turn of the millennium. The need for personnel has been reduced mainly by support functions becoming more effective due to technical progress and the shift to making two annual macroeconomic forecasts instead of four. ETLA has throughout its history served as a training place for economists as they have moved on to universities, other research institutions, ministries, the central bank, organizations and the business community.
ETLA has operated in several locations in the centre of Helsinki. For the longest time, from 1977 to 2016, the institute was located at Lönnrotinkatu 4. In February 2016 ETLA moved to new premises at Arkadiankatu 23.
The Research Institute of the Finnish Economy and its predecessor have had 12 managing directors (Kaarlo Larna acted as managing director twice):