The 21st century has begun with an era of massive shocks to the world economy, with negative effects on practically all countries. The first major shock, the 2008 global financial crisis, originated in the US financial markets and rapidly propagated to the real economy, causing extensive and persistent shock effects. The latest crisis, caused by the Covid-19 virus, is of entirely different origin, yet it again resulted in a global downturn. While no one knows when, how and why the next shock appears, a clear lesson nevertheless is that much more attention should be placed on the analyzing how companies and societies could improve their resilience against future shocks.
This research project aims at identifying the means of Finnish companies to survive shocks, the impacts of shocks on global value chains and international trade, and finding instruments and policies to improve companies’ resilience. By using novel datasets and methodologies, the project provides essential new information about the resilience against external shocks. The ultimate purpose is to assist national innovation strategy setting and to participate in drafting actionable plans for the future.
Previously, the characteristics of firm resilience have not been dealt with in depth. For that reason, the strategy is to adopt a multi-approach to study resilience. The project will study the heterogeneous impacts of Covid-19 shock on firms and the renewal of companies during and after the shock. Furthermore, the value chains’ role as channels to transmit shocks is analyzed and the performance of Finnish and Swedish industries after an import shock related to China is also compared. While these investigations will generate policy implications, a separate policy-relevant analysis focusing on the impacts of Business Finland’s funding for business development in disruptive circumstances is also conducted.
The main aim of this project is to support decision-makers in their developmental work. As a part of dissemination efforts, ongoing work and preliminary results will be presented to Business Finland and other stakeholders. Another example of dissemination elements concerns podcasts, including the interviews of project researchers concerning their findings. Naturally, research reports and policy briefs will be published to reach more research and policy-oriented audience.
The work is organized in three work packages:
Etla is implementing this project together with VTT. In addition, the project will be done in cooperation with the University of Strathclyde (the UK), Luiss University (Italy) and Lunds University (Sweden).