Modern Economic History of Sweden
Modern Economic History of Sweden
Sweden is one of the northernmost countries in the world, lying farthest from the equator with the Arctic Circle crossing its northern regions. With a total area of roughly 450,000 square kilometers, Sweden is one of the largest countries in Western Europe. Its population density is relatively low; however, it had a population of just over 8.8 million in 1998.
Sweden is a constitutional monarchy, traditionally neutral, since early 19th century. Norway, formerly united with Sweden, became independent in 1905. Sweden adopted parliamentary government in 1921.
Since World War II, Sweden has experienced a long period of economic progress based in the development of its resources (iron ore, timber, and hydroelectric energy) with major reliance on a market economy and participation in foreign trade. Sweden has a mixed economy in which private and state-owned enterprises exist side by side. This “Swedish model”, a concept that came about in the late 1930s, refers to the way Sweden fostered prosperity by avoiding the pitfalls of both communism and capitalism.
Since 1932, Sweden’s socialist government has steered “the middle way” by allowing the private and public sectors to develop together. This was very successful for many years. An essential factor was the cooperation of the three main players in the economy: government, labor, and business. Unlike other socialist nations, Sweden’s government did not nationalize important industries.
The public sector provides essential services, such as telecommunications, postal service, and energy. It is also responsible for health care, education, and social welfare.
Swedish economy has changed during the periods of 1960s, 1970s 1980s, 1990s and recently. This topic will emphasize that most economies of Sweden experienced difficulty during these times.
1960s
During the 1960s, the growth of the real GDP in Sweden was 5.3 percent per annum, among the highest growth rates in Europe. At the late 1960s, the Social Democracy began to advocate an event greater emphasis on equality, industrial democracy, and social control of investment. The social justice ideal, for which the slogan Jamlikhet appeared in the late 1960’s contains the belief that:
“All individual have an equal right to a rich and evolving life…(meaning)… security, freedom, happiness, the right to cultural opportunities, employment, and influence in the community. This (means) an approach to equalization of income. (It calls for reforms) directed against the privileged for the advantage of the underprivileged and the bettering of their conditions...