понедельник, 21 сентября 2009 г.

Swedish Model Conclusion

So, the main objectives of the Swedish model - full employment and equality, which depend on price stability, economic growth and competitiveness. Combination of common restrictive measures and active labor market policy was seen as a means of reconciling full employment with stable prices. Universal policy blagosostayaniya and trade union policy of solidarity in wages - the constituent parts of the Swedish model. The model was developed over several decades has shown the viability of ideas and policies of solidarity in the field of wages, full employment without inflation, active labor market policies. What are the lessons from the experiences and achievements of the Swedish model can be done?

Undeniable success of the Swedish labor market. Sweden remained extremely low unemployment in the postwar period, including the mid 70's, when serious structural problems have led to mass unemployment in most developed capitalist countries.
There are certain achievements in the long struggle for equality. Full employment is in itself an important factor in alignment: a society with full employment avoids the differences in incomes and living standards resulting from mass unemployment, because long-term unemployment leads to losses in income. Incomes and living standards are aligned in two ways in the Swedish society. The solidarity in wages strives to achieve equal pay for equal work. The government uses a system of progressive taxation and extensive public service.

Sweden has been less successful in other areas: prices rose faster than in most other OECD countries, GDP grew more slowly than in some Western European countries, labor productivity barely grew. The fall in labor productivity growth - an international phenomenon, caused by, inter alia, the expansion of the service sector, which is less able to rationalize it. To some extent, an adverse development in Sweden due to a large public sector, which, by definition, does not increase productivity. Thus, inflation and relatively modest economic growth are certain the price paid for a policy of full employment and equality.

The weakest of the model was the complexity of the combination of full employment and price stability. But the 80-ies, these difficulties are not manifest as a serious threat to the overall model. The reasons lie in the policy. The Social Democrats had a government, relying on the minority in rikstage, and the position of the party is waning. The government recognized the need for a strong fiscal policy, but found no support etou in parliament. Restrictive policies generally unpopular, and the government stay in power for short: national elections are held in 3 years, and the government need determination and political courage in curbing high conjuncture.

Thus, the Swedish model was under threat. Saving the future of the two main objectives of the Swedish model - full employment and equality - seem to require new methods, which must conform to the changed conditions. Only time will tell to see if specific features of the Swedish model - low unemployment, a policy of solidarity in the area of wages, centralized negotiation of wages, only large public sector and, accordingly, a heavy tax burden, or the only model consistent with the special circumstances of the postwar period.

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