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Encyclopedia > Swedish welfare state

Swedish welfare refers to the Swedish variant of the mixed economy prevalent in much of the industrialized world. Similar systems are found especially in the other Nordic countries. Overview map of the region. ...

At one point, Sweden was categorized by some observers as a middle way between a capitalist economy and a socialist economy. The most enthusiastic supporters of this idea asserted that Sweden had found a way of acheiving one of the highest levels of social equality in the world, without stifling entrepreneurship (for example Swedish businessman Ingvar Kamprad is arguably the world's richest person). However, this viewpoint has become somewhat antiquated due to economic liberalization in Sweden as well as a decline of outright socialism as a viable approach to economic management in the minds of much of the world. In economics, a capitalist is someone who owns capital, presumably within the economic system of capitalism. ... Socialism is a social and economic system (or the political philosophy advocating such a system) in which the economic means of production are owned and controlled collectively by the people. ... Ingvar Kamprad (born March 30, 1926) is an industrialist from Sweden. ...

Traditionally, the term "Swedish Model" was popular among some. It is now infrequently used, partly because it implies that Sweden had somehow developed a comprehensive approach to economic policy for others to copy. Few people believe that to be the case today, although the idea is not completely dead; for example the September 2006 issue of The Australian Financial Review magazine carried an article which praised what it asserted to be Sweden's distinctive political and social system.

Admiration for Sweden's economic system has traditionally been associated with an admiration for what is said to be the country's liberal attitude to social issues.

Sweden's system developed slowly but persistently throughout the twentieth century as a result of many decisions. The development was lead by the Social Democratic party and the trade unions. Typically, this involved significant opposition from the business community and the right-of-center opposition. However, the opposition eventually came to accept much of the Social Democratic system, and has typically worked to reform it from within.



There is some dispute as to whether the origins of the Swedish welfare are in 1930s or the late 19th century, before the Social Democrats first came to power in 1920). In 1847 and 1853 Sweden passed "poor relief laws," taking the first step toward implementing the welfare state. The Swedish Trade Union Confederation Landsorganisationen i Sverige) was founded in 1898 with a strong tie to the Social Democratic Party. As early as 1913, Sweden's Liberal Party government (non-socialist), with the support of the populace, began broadening the range of social benefits. It took most other developed countries until the Great Depression of the 1930s to take similar steps. A possible explanation for this is often said to be certain cultural norms dating back to the small agrarian villages which were relatively late to be industrialized. These values asserted conformity and egalitarianism over individualism (see Jantelagen and lagom.) The Liberal Party government passed the National Pension Act in 1913 to provide security for the aged. In 1918 a liberal-SAP coalition government passed a new poor law, turning the responsibility of assisting anyone in need over to local governments, while the central government contributed administrative support. This law was to remain the cornerstone of Sweden's assistance programs for the next 40 years. The Swedish Social Democratic Party (Sveriges socialdemokratiska arbetareparti, commonly referred to as Socialdemokraterna), is the largest political party in Sweden. ... LO logo The Swedish Trade Union Confederation (Landsorganisationen i Sverige or LO) is an umbrella organisation for sixteen Swedish trade unions that organise blue collar workers. ... The Great Depression was a worldwide economic downturn which started in 1929 (although its effects were not fully felt until late in 1930) and lasting through most of the 1930s. ... The Jante Law (Danish and Norwegian: Janteloven Swedish: Jantelagen Finnish: Jante-laki) is a concept created by the Danish/Norwegian author Aksel Sandemose in his novel A refugee crosses his tracks (En flygtning krysser sitt spor, 1933), where he portrays the small Danish town Jante, modelled upon his native town... To meet Wikipedias quality standards, this article or section may require cleanup. ...

The welfare state was built much thanks to the ruling party being the Swedish Social Democratic Party, the large unions that encompassed almost the entire population, and the industries that were similarly almost all unionized. Still today trade unions play an important part. In January 2002 the Confederation had 1,960,000 members (Sweden has a total population of 9,000,000). Sweden's industries have consisted of a few global chains since the late 19th century, such as Electrolux, Volvo and Ericsson, in 1902 united in the confederation "SAF" (since 2001 merged into the Confederation of Swedish Enterprise). The Swedish Social Democratic Workers Party or Social Democrats (Swedish: Sveriges socialdemokratiska arbetareparti or Socialdemokraterna; literally, Social Democratic Workers Party of Sweden and Social Democrats) is a major political party in Sweden. ... The examples and perspective in this article or section may not represent a worldwide view. ... Electrolux is a Swedish company that is the worlds largest manufacturer of kitchen, cleaning and outdoor appliances for both home and professional use. ... AB Volvo (or Aktiebolaget Volvo) is a world-leading Swedish manufacturer of commercial vehicles, buses and construction equipment, drive systems for marine and industrial applications, aerospace components and services. ... Ericsson () NASDAQ: ERICY is a Swedish telecommunications equipment manufacturer, founded in 1876 as a telegraph equipment repair shop by Lars Magnus Ericsson. ... The Confederation of Swedish Enterprise, or Svenskt Näringsliv, is a major interest organization for business and industry in Sweden. ...

In 1938 the Saltsjöbaden agreement (named after the smalltown Saltsjöbaden) between the workers and employers confederations was signed. It resolved several issues on the market. It came to form a particular form of industrial relations in Sweden, the so-called “Saltsjöbaden spirit”, marked by willingness to co-operate and a mutual sense of responsibility for developments in the labour market. [1] 1938 (MCMXXXVIII) was a common year starting on Saturday (link will take you to calendar). ...

Sweden's social welfare continued to develop during the 1950s and 1960s, during which time Sweden was the second wealthiest country in the world for a period, with practically zero unemployment. The Welfare State then reached a peak in the 1970s, when it in effect affected and included everyone from child care to the pensioning system. The exact event that made it "peak" and slowly decrease was the 1973 oil crisis. For brief periods Sweden was controlled by moderately right-leaning governments, which seem to have come about due to periods of high taxes and unemployment. Childcare is the act of caring for and supervising minor children. ... -1...

Only in the latest decades did changes arise, due to a hard industrial crisis, resulting to a decrease in social fundings in the 1990s. This recession hit Sweden hard, and caused social problems for many years afterwards, such as higher crime-rates. Sweden was brought out of the recession, but in 2000 there was a minor crisis due to the worldwide burst of the dot-com bubble. Further economic precautions brought about a strong, growing economy.

Although it is clear that the Global Economic Environment is changing, posing a threat of job outsourcing to employment within Sweden, health care, education, and plentiful natural resources have ensured that Sweden has for now maintained moderately high levels of employment (though there is a debate on the actual level of unemployment, some sources claiming it to be quite high, and it is believed by many to be high among youth), and moderately strong levels of economic growth. Sweden has been recently ranked as one of the strongest economies in Europe. In this regard, Sweden is acclaimed by many to be a successful example of Social Democracy. Many praise the Social Democrats for taking Sweden out of the recession of the 1980s and early 1990s, and argue that the problems Sweden faces are due to an ongoing adaptation to the global economy. Others say that Sweden's current system is taxing on the economy and further reforms need to be made to encourage economic growth. They say that the current system creates a bidragskultur (a welfare culture) where people, especially youth, are not motivated to work. Others argue that the youth would work if it were not so difficult for them to find jobs. It should be mentioned that Sweden currently has one of the world's lowest poverty levels, (6% according to the United Nation's Human Development Report), and is among the top five most egalitarian countries in regards to income distribution. Both of these are major goals of the Swedish welfare system. However Sweden's GDP per capita is currenly lower than her Scandinavian neighbors, and economic growth is a major issue right now. Sweden faces an election this fall, and the country is currently split between left and right, but even a possible right-leaning coalition government intends to maintain the foundations of the Welfare State, with some adjustments intended to lower unemployment and further economic growth. No major party in Sweden has in its program to disassemble the Social Welfare state. To attempt to dismantle the Welfare State would prove to be unpopular with Swedish voters, who are typical skeptical of both the far right and the far left. Social democracy is a political ideology emerging in the late 19th and early 20th centuries from supporters of Marxism who believed that the transition to a socialist society could be achieved through democratic evolutionary rather than revolutionary means. ...

Denmark, which has a somewhat similar Welfare system, has recently managed to lower its unemployment by creating less restricting laws governing job security (making it easier to fire people, like in the Anglo-Saxon model) while still maintaining a strong safety net for the unemployed. It remains to be seen what the long term effects of this system establshed by Denmark's former ruling Social Democrats, called Flexicurity are, but other European countries, including perhaps Sweden and France, have mentioned a possible interest in this model. Flexicurity (a portmanteau of flexibility and security) is a welfare state model with a pro-active labour market policy. ...


  1. ^ The Saltjö agreement At the European Foundation for the Improvement of Living and Working Conditions website.

The European Foundation for the Improvement of Living and Working Conditions is a agency of the European Union, with offices located in Dublin, Ireland. ...

See also

Swedens long-successful economic formula of a capitalist system interlarded with substantial welfare elements was challenged in the 1990s by high unemployment and in 2000-02 by the global economic downturn, but fiscal discipline over the past several years has allowed the country to weather economic vagaries. ... The Scandinavian welfare model is often used as a general term for the way in which Denmark, Sweden and Norway have chosen to organise and finance their social security systems, health services and education. ... Please wikify (format) this article as suggested in the Guide to layout and the Manual of Style. ...

Further reading

  • Peter A. Swenson, Capitalists Against Markets: The Making of Labor Markets and Welfare States in the United States and Sweden , Oxford University Press (September, 2002). ISBN 0-19-514297-7

External links

Right-Wing Critiques

  • The Myth of the Scandinavian Model, by Martin De Vlieghere, Paul Vreymans and Willy De Wit
  • How the Welfare State Corrupted Sweden, by Per Bylund
  • Swedish Models by Johan Norberg



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