3  Long-term interest rates, income growth and house prices  Favourable economic developments in Norway have had an impact on developments in our property markets. House prices have risen sharply over the past 14 years. Real house prices have almost trebled. This rise has been considerably stronger than earlier. Moreover, the rise in house prices has spanned a long period. With the exception of a few months in 2003, house prices have risen continuously since 1992. This is the second longest period of rising real prices since 1819. Statistics for earlier years do not exist. House prices also rose in the 18 years between 1954 and 1972, albeit at a more moderate pace. BIS Review 15/2007  7  Norway is not the only country where house prices have shown a strong rise over a long period. House price inflation has been particularly high in Ireland and the Netherlands, but Denmark, the UK and Spain also stand out. The countries where house price inflation has been high are the same countries where economic growth has been strongest. Since prices are rising in tandem in many countries, it is natural to look for common driving forces. With increasing cross-border flows of intermediate goods, capital and increasingly so labour, prices will largely reflect growth and competition in the global economy. If capital or labour becomes too expensive in one country, businesses can relocate production. Prices for fixed factors of production, such as property, will on the other hand reflect income developments in different countries.
Keynes, both on microfilm, makes the library an excellent repository for undertaking any study of economic history. Let me conclude with a few words about today’s III Seminar of Economic History that we are opening now. As you can see in the programme, we have about thirty participants from a dozen universities, central banks and research centres. Economists from the Banco de España are participating as authors and also as discussants of a number of papers on historical episodes that are relevant to our understanding of the world of today. Many thanks to all the participants, authors and discussants. We are really honoured this year to have with us one of the leading expert in the history of central banking, Professor Charles Goodhart, for many years at the Bank of England and now at the London School of Economics. Thank you very much, Professor Goodhart, for joining us today. Now, without further ado, I give the floor to Pablo Martin Aceña, for his introductory remarks. 4/4