First, limits in expanding agriculture and industry sectors and the resultant hindrance of economic expansion. Second, in the current economic context, a greater emphasis has to be placed in not only expanding the services sector, but also improving its productivity in order to achieve higher economic growth. Let me elaborate on these two reasons in a broader manner. The economic history of countries clearly shows that there is a set pattern of the transformation of the structure of economies, typically from agriculture to industry and then to services. It happens due to two major reasons. First, in the first stage, the economic value was entirely created by agriculture, which is called the pre-industrial era. Thereafter, the source of a country’s economic value shifted to industry with fast  BIS Review 116/2008  1  industrialization. However, the value creation through agriculture and industry was constrained at a certain point as the performance in both the agriculture and industry naturally depends mainly on the natural resource endowment. Therefore, when the natural resource endowment of countries limits further expansion of agriculture or industry, a greater need for improving productivity arises. Second, when growth is limited due to constraints in agriculture and industry, the vacuum has to be filled with some other more efficient economic activity. Otherwise, the economy would be stagnant. Hence, the existence of an efficient and vibrant services sector has become a necessity for further growth of the economy as a whole and the agriculture and industry sector in particular.

In other areas of society, it is not always the case that those who are qualified to make good decisions also have the power to implement them. In the interest of democratic governance there may be good reasons why this is so, but the decision-making process will then require considerable attention. We can concentrate on promoting an understanding of the decisions we make. We must be transparent about what we do, and explain premises, economic relationships and results. Our decisions must be well communicated and understood. If we are unsuccessful in this respect, our reputation may be impaired. Independence, transparency and good decisions are intertwined. Independence is a precondition for keeping promises. Keeping promises was the topic of my lecture here two years ago. 38 We must also communicate and explain interest rate decisions to the public so that they have confidence that we are discharging our duties properly. Transparency is a precondition for accountability and that was the topic of my lecture here last year. 39 Today I have been speaking about how we can arrive at decisions that are good ones. Adequate institutional arrangements, high-quality professionals and appropriate routines are important elements for doing just that. Hans Rasmus Astrup died in 1898, twelve years after this building was completed. Astrup’s two daughters sold the house to the Norwegian Academy of Science and Letters a few years after their father’s passing. They gave the Academy a gift of 106,000 kroner to go towards buying the house. The remaining funds were raised from donations.