Nordic Model

12 Key excerpts on "Nordic Model"

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  Small Nations in a Big World

  New Edition

  • Michael Keating, Malcom Harvey(Authors)
  • 2020(Publication Date)
  • Luath Press

    (Publisher)

  CHAPTER 6 The Nordic Zone. Social Democracy in Changing Times The Historic Roots of the Nordic Model

  DENMARK, NORWAY AND SWEDEN , which are social investment states with social democratic orientation, have, for several decades, provided something of a benchmark for proponents of a high tax, high spend model. Indeed, the ‘Nordic Model’ has been celebrated by social democrats as a successful means of combining economic growth with social assistance programmes. It has been lauded in other small polities such as Scotland as an attractive model to follow, and derided by neo-liberals as paternalist and anti-business. The Nordic Model, at least as a Weberian ideal-type, combines a comprehensive social security system with institutionalised social rights, social solidarity, and a tripartite bargaining system which requires co-operation between employers’ associations, employees (organised through widespread unionisation) and the government. It requires high levels of taxation to provide for generous active labour market policies such as universal unemployment and sickness insurance, and correspondingly high levels of employment to ensure that revenue from taxation exceeds spending on welfare payments. It also requires high levels of social solidarity, which is achieved through universal programmes, ensuring that the middle classes receive the benefits they pay for through taxation. It is a social investment model that relies on human capital to provide social protection to citizens.

  Pre-industrialism, the Nordic states functioned much like other European polities, although early universal suffrage and separate agrarian parties led to a much more egalitarian society. Some of the future principles which would underscore the Nordic Model emerged at an early stage. Seven years of public education became the norm, introduced in Denmark in 1814, in Sweden in 1842 and in Norway in 1848. At the same time, Sweden and Norway began to provide basic medical services to the needy (Kildal and Kuhnle, 2005). These services were regulated by local authorities through national legislation passed in the mid-1800s and they remained selective in character. In the early 1900s, liberal governments in Denmark, Norway and Sweden introduced welfare programmes that provided better working conditions for employees in an attempt to overcome class conflict and create in its place a feeling of social solidarity (Brandal, Bratberg and Thorsen, 2013). Here was a first attempt to combine the principle of economic assistance with societal engineering.

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  Social Policy and Economic Development in the Nordic Countries

  • O. Kangas, J. Palme, O. Kangas, J. Palme(Authors)
  • 2005(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  How can the Nordic experience be interpreted in this perspective? Nature and consequences of the ‘Nordic Model’ Different approaches to the question of social protection have been elaborated among countries with the most advanced industrial market economies. In this context, the Scandinavian or Nordic welfare state model is an established concept world-wide. Yet there appears to be something of a mystery about the nature and consequences of the model. Some scholars have gained their academic credentials by launching the idea of a model 1 2 Social Policy and Economic Development and defining its characteristics, while others have claimed that such a model does not exist at all, that there only are country-specific development paths and outcomes and that instead of the Nordic Model we should speak about the Danish, Finnish, Norwegian and Swedish models. The views concerning the merits and drawbacks of the model also diverge widely among different observers. There are Candide-like opinions that the Nordic welfare state is the best of all possible thinkable worlds, guaranteeing high levels of well-being and decent life-chances to all regardless of circum- stances. The most notable achievement in this field is poverty reduction: Nordic poverty rates are among the lowest in the world. For these analysts, the Nordic countries are a good example of how it is possible to unify equal- ity, a ‘big’ welfare state and a high level of taxation with economic growth. However, critical voices describe the situation quite differently: by equalising incomes through lavish welfare benefits the welfare state creates work dis- incentives and kills individual initiative, which hampers economic growth. In the longer run, this ‘passion for equality’ is also detrimental for the poor. Our opinion is that the extreme views expressed on both sides are often based on wishful thinking or prejudice, on myth rather than reality.

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  The Nordic Model

  Scandinavia since 1945

  • Mary Hilson(Author)
  • 2008(Publication Date)
  • Reaktion Books

    (Publisher)

  Chapter 3The Nordic Model of Welfare

  Despite the political influence of the social democratic left, post-war Nordic economic policy remained, as we saw in the previous chapter, tolerant of capitalist enterprise. The Nordic governments made few attempts to take control of the commanding heights of the economy through nationalization. Instead, their primary concern was with the distribution of the fruits of capitalist prosperity and the development of state welfare systems that have generally been recognized as some of the most comprehensive, far-reaching and ambitious in Western Europe. The welfare state is central to any discussion of the Nordic countries after 1945. The so-called Nordic welfare model has attracted the attention of countless scholars and policy makers, and at the beginning of the twenty-first century remains one of the most enduring stereotypes about the Nordic countries.

  Scholarly discussions of the Nordic welfare model have often concentrated on social insurance schemes established to take care of those citizens who for different reasons were unable to support themselves through paid employment. It is generally agreed that the Nordic social insurance systems were more comprehensive than those of many other welfare states, and that they also shared certain features, such as universalism, that meant that they went further than many other countries’ systems in reordering social relations and promoting high levels of social equality. The distinguishing characteristics of the Nordic social security systems, and the possible historical causes for their development, are thus discussed in some detail in this chapter.

  The Nordic welfare states were more than social insurance systems, however. In fact, in all the Western European welfare states during the post-war period the welfare state was seen as an integral part of managing the capitalist economy: a force for promoting economic efficiency, ordering social relations and securing the reproduction of society. Where the Nordic governments seemed to stand out was in the breadth and ambition of their vision for the welfare state, and their faith in their own ability to create the good society. No other democratic societies seemed to be quite so affected by extensive state intervention into all areas of human life as the Nordic countries. As the historian Henrik Stenius has put it, ‘All the doors are open – to the living room, the kitchen, the larder, the nursery, not to mention the bedroom – and they are not just open: society marches in and intervenes, sometimes brusquely.’1

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  Institutional Change in the Public Sphere

  Views on the Nordic Model

  • Fredrik Engelstad, Håkon Larsen, Jon Rogstad, Kari Steen-Johnsen, Fredrik Engelstad, Håkon Larsen, Jon Rogstad, Kari Steen-Johnsen(Authors)
  • 2017(Publication Date)
  • De Gruyter Poland

    (Publisher)

  The effectiveness of the model is measured against empirical vari-ations in the Nordic societies at any given time and whether core elements are present to a degree that it makes sense to talk about a common basic structure sufficiently dif-ferent from other post-industrial countries. In its socio-economic version, the Nordic Model has three main components: (i) a large, active and at the same time liberal state; (ii) class compromise and cooperative relationships between labour market parties organized in national federations and (iii) a generous welfare state. In many respects, these elements are reciprocally supportive in the same sense as the concep-tion of institutional bundling in Varieties of Capitalism (Hall & Soskice, eds., 2001), as specified by Dølvik et al. (2015) and Engelstad & Hagelund (2015). The sustainability of the Nordic Model rests on the dynamism of capitalism, tem-pered by broad normative and institutional preconditions. This gives the model con-siderable stability and at the same time necessary flexibility. The normative precondi-tions constitute democratic culture, egalitarianism and social inclusion developed over a period of more than a century (Alestalo et al., 2009; Aakvaag, this volume). In a broad sense, these norms do not differ significantly from those in many other demo-cratic societies; the salient point is how they have materialized over time in institu-tional structures. They could not be developed and sustained without a wide space for political and social deliberation. A well-functioning public sphere as an arena for the formation of basic consensus – and at the same time conflict and compromise – is

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  The Making and Circulation of Nordic Models, Ideas and Images

  • Haldor Byrkjeflot, Lars Mjøset, Mads Mordhorst, Klaus Petersen, Haldor Byrkjeflot, Lars Mjøset, Mads Mordhorst, Klaus Petersen(Authors)
  • 2021(Publication Date)
  • Routledge

    (Publisher)

  Part 1 The Nordic Model as socio-economic and political construct  Passage contains an image

  2 Images of the Nordic welfare model Historical layers and ambiguities

  Pauli Kettunen and Klaus Petersen

  DOI: 10.4324/9781003156925-3

  Introduction

  The purpose of this chapter is to historicize ‘the Nordic Model.’ Historicizing does not simply mean demonstrating that notions of a Nordic societal model existed prior to the more recent launch of this expression, but more importantly, to study the actual processes of representing Nordic specificities as a kind of model. The notion of a Nordic Model was constructed during the gradual transformation of the five Nordic nation states into welfare states. More recently,the Nordic Model has been subject to a (re-)branding as a combination of competitiveness and social investments, associated with contests about the political ownership of the model. We outline the dynamics and periods of these developments and discuss the ambiguities included in the images of a Nordic Model.

  Welfare states did not develop within closed national containers. They evolved through the interaction of domestic factors, cross-border transfers of ideas, and transnational interdependencies (Haas, 1992 ; Conrad, 2011 ; Kettunen and Petersen, 2011 ; Obinger et al., 2012 ). A key feature of this process was comparison as a political practice that played a major role in political agenda setting as well as in the production and transmission of social knowledge (Kettunen, 2006 ; Ogle, 2015 : 4–9). This topic is especially important in connection with research on the Nordic welfare states (Petersen, 2006 ). The transnational attribute ‘Nordic’ implies a frame of reference, institutionalized in Nordic cooperation, for comparisons among the Nordic countries as well as between them and the rest of the world. Such meanings of the Nordic become especially evident in a historical analysis of both national and international social policy debates. On the one hand, it is reasonable to argue that ‘the Nordic element has never lastingly gone beyond national frameworks’ (Sørensen and Stråth, 1997

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  Dreamworld or Dystopia?

  The Nordic Model and Its Influence in the 21st Century

  • Michael A. Livingston(Author)
  • 2021(Publication Date)
  • Cambridge University Press

    (Publisher)

  For a sample, see Torben M. Andersen, Karl-Ove Moene, and Agnar Sandmo (eds.), The Future of the Welfare State (Oxford: Scandinavian Journal of Economics, 1995); Andreas Bergh, Sweden and the Revival of the Capitalist Welfare State (Cheltenham: Edward Elgar Publishing, 2016); Nils F. Christensen, Klaus Petersen, Nils Edling, and Per Haave (eds.), The Nordic Model of Welfare – A Historical Reappraisal (Copenhagen: Museum Tusculanum Press, 2006); Subhash Thakur, Michael Keen, Balazs Horvath, and Valerie Cerra, Sweden’s Welfare State: Can the Bumblebee Keep Flying (Washington, DC: International Monetary Fund, 2003). Some of this literature was referenced in Chapter 1. 18 Mary Hilson, The Nordic Model: Scandinavia since 1945 (London: Reaktion Books, 2008). 54 Images Nordic countries, the response of individual governments remained quite different, with Sweden adopting an essentially multicultural approach and the remaining Nordic nations, particularly Denmark, adopting an assimila- tionist policy that privileged the national (Danish) culture over any alterna- tive. Thus, Hilson suggests, it is more accurate to speak of a range of Nordic immigration policies than one particular model. Hilson wrote in 2008, before the Sweden Democrats became a significant factor in politics and Swedish policy, like that of its neighbors, began to emphasize cultural integration in place of or at least as a balance to the previous multicultural approach. Nevertheless, her argument regarding the complexity of the immigration issue and the difference in approaches between the Nordic countries remains relevant today. 19 The migration issue is also dealt with, if indirectly, by several different authors in Sustainable Modernity: The Nordic Model and Beyond, 20 a collection edited by Nina Witoszek and Atle Midtunn, which we will have occasion to revisit in succeeding chapters.

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  Nordic Cooperation

  A European region in transition

  • Johan Strang(Author)
  • 2015(Publication Date)
  • Routledge

    (Publisher)

  4   The Nordic Model and the rise and fall of Nordic cooperation

  Pauli Kettunen, Urban Lundberg, Mirja Österberg and Klaus Petersen1

  Introduction

  ‘The Nordic Welfare State Model’ is a well-established brand. Celebrated by politically divergent commentators, it has become a standard concept in political science, in comparative welfare research and in public political debate. Different interpretations appear of what the Nordic Model means, and so do stereotypical images of its origins and characteristics. However, historical research has increasingly contributed to a deeper and a more differentiated view. Historians have also explored the importance of Nordic cooperation for the historical development of the Nordic Model. They have shown that cooperation among expert groups, professionals, politicians and other key actors in Nordic welfare state history have built Nordic standards and competition. Nordic meetings, conferences and journals have served as a platform for inter-Nordic diffusion and transnational learning. It can be argued that the regular and close contacts and possibly also a shared progressive ideology have facilitated the establishing of what can be labelled as a Nordic epistemic community. This again has led to the development of shared norms for ‘Nordic social policy’ and the construction of a distinct Nordic Model, both as a set of institutions and as an imagined community.

  So far, so good! However, a striking paradox is now before us: the popularity of ‘the Nordic Model’ has greatly increased while the practical Nordic cooperation in welfare policies has diminished. This paradox will be analyzed here, and it seems relevant to discuss it in the framework of new forms of nationalism inherent in globalized capitalism.

  An ambiguity appears in the current usage of the concept of ‘model’, referring to a structure that has become threatened through globalization or pertaining to a way of responding to the challenge. The former is obvious in the debate on the threats against the ‘Nordic welfare state model’. The latter, in turn, has been manifested in the praising of ‘the Danish model’ of ‘flexicurity’, or ‘the Finnish model’ as a paragon of consensual competitiveness in a new knowledge-based society, or ‘the Nordic Model’ in general, assessed to be capable of embracing globalization by means of risk sharing. In both cases – the model as a target of threats or as a response – globalization is tackled as a national challenge. Yet the ambiguity of the concept of model indicates the changing role of the nation state, which can be characterized by the concepts of welfare state and competition state.

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  The Global Economy, National States and the Regulation of Labour

  • Paul Edwards, Tony Elger(Authors)
  • 2014(Publication Date)
  • Taylor & Francis

    (Publisher)

  5 THE NORDIC MODEL AND THE MAKING OF THE COMPETITIVE ‘US ’  Pauli Kettunen  

  At the same time as the nation state is said to be eroding in the globalizing world, reflections on different ‘models’ which refer to nationally organized forms of social life remain vivid and popular. Expressions such as the ‘Japanese model’, ‘German model’ or ‘model of New Zealand’ are frequently used in public discussion. The ‘Anglo-Saxon model’, ‘Rhine model’, or ‘Nordic Model’ claim similarities among some countries, but even here one talks about institutions within nation states. While there are different forecasts concerning a convergence or divergence of models, such ‘model consciousness’ questions any simplistic story of globalization. However, it would be an understatement to take the discussion of models as just an indicator of the fact that globalization has not yet proceeded as far as the most enthusiastic proponents of the globalization thesis suggest (see Hirst and Thompson, 1996; Beck, 1997). Rather, this model consciousness is to be seen as a way in which national perspectives are reproduced, not despite but through globalization.

  In this chapter the relationship of the Nordic Model of labour relations to globalization is discussed. The ‘Nordic Model’ refers to national institutions in the five Nordic countries, Denmark, Finland, Iceland, Norway and Sweden. I will not, however, just adopt this concept instrumentally, but take seriously the historicity of the model discussion. What follows is not primarily an account or a forecast concerning the impacts of the processes called globalization on the national institutions called the Nordic Model. My primary interest concerns a particular type of power: the power of defining the agenda, in this case the agenda of working-life issues.

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  Institutions for Social Well Being

  Alternatives for Europe

  • L. Costabile(Author)
  • 2008(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  An alternative model is found in the Anglo-Saxon countries where the provision of welfare is targeted to people who are worse off and are treated differently from the main part of the population. Such a model needs a lower level of funding from the public and employers, but tends to encourage the belief that the poor are different from the majority; it does not promote equality. 176 Björn Gustafsson 177 In contrast to these models, the Nordic or Social Democratic Model does not promote stratification while it fosters decommodification. There are universal programmes such as basic pensions and child allowances where little means-testing takes place, whereas in other programmes benefits are positively linked to earned income. Sweden is the archetype of the Nordic or Social Democratic Model. Several themes can be found in the literature succeeding Esping- Andersen (1990). One such critique is that this classification is based on studying social security systems only, while the welfare state is broader in scope. The welfare state not only channels resources between the mem- bers of society, but also provides social services. Such services are typically provided by women; the welfare state is not gender neutral. Sweden has assumed a special position in this aspect, as for some years female labour force participation rates have been almost as high as for males. At the same time, most paid care work in the public sector is undertaken by women. Another theme in the literature following Esping-Andersen (1990) has been to scrutinise the proposed classification system. 2 There seems to be a tendency among analysts to not be satisfied with only three categories. Perhaps most widespread is the idea of including a Southern European system of welfare state. This model differs from the Continental system by giving a much greater scope to family responsibilities.

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  Macroeconomics Beyond the NAIRU

  • Servaas Storm, C. W. M. Naastepad, C. W. M Naastepad(Authors)
  • 2012(Publication Date)
  • Harvard University Press

    (Publisher)

  What most economists see as a recipe for serious economic trouble has, in the Nordic countries, led to high growth, low unemployment, low inequality, and a fairly efficient allocation of resources. How do the open, de-pendent, and globalized Nordic countries manage to escape the supposedly ubiquitous NAIRU trade-off between growth and low unemployment, on one hand, and egalitarian outcomes, on the other? This is the issue addressed in this chapter. A Provisional Utopia “Kropotkin was no crackpot,” writes Gould. Neither were Swedish econ-omists Gösta Rehn and Rudolf Meidner, the two architects of the unique economic policy model (Meidner and Rehn 1953) that shaped Swedish economic policies during the past five decades and has also influenced policies in the other Nordic economies. Building on Keynes, the two men understood that social welfare, corporate governance, and macro-economic management needed to be brought together if full employ-ment and fair wages were to be maintained with low inflation and rapid growth. The Rehn-Meidner model can be seen as a form of modified Keynesianism that, by combining private ownership and free markets with strong regulation and coordination, comes close to being a “provisional utopia”: Eu rope’s Nordic Model 189 The values of the highest priority are full employment and equality. Both come into conflict with other goals, notably price stability and ef-ficiency. The conflict between full employment and price stability can be solved by a policy which combines restrictive general demand man-agement and [active] labour market policy. Equality pursued by a sys-tem of general welfare, by a large public sector and by a wage policy of solidarity has to be compatible with the goals of efficiency and economic growth. (Meidner 1993, 217–218) We can distinguish five major components of the Swedish model. First, total demand should be kept high by fiscal and monetary policy, but not so high as to lead to excessive demand and rising inflation.

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  Development Models, Globalization and Economies

  A Search for the Holy Grail?

  • John B. Kidd, Frank-Jürgen Richter(Authors)
  • 2005(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  These strategies of Nordic govern- ments differ from those of Germany, where the idea of property was institutionalized in the role model of the owner-entrepreneur, and of the USA, where professional managers increased their power vis-a-vis fragmented shareholders. The idea that shareholders ought to exert greater influence is promoted by a small but growing middle-class movement. There is an increased focus on the role of management, often justified by referring to the individual's rights to choose, to human and social rights, and to the need of organizations to serve the consumer. Thus the traditional US model of management is becoming 68 Nordic Model of Economic Development, Management less realistic, built as it was on the idea of management as a profession, which implies a stakeholder view of the firm and the idea that a mana- gerial career is a life project. Modern business life and social affairs relies on powers of communication and the ability to create temporary iden- tifications and visions. Networking and trusting have become critical skills, due to a stronger emphasis on contracts, projects, and life-long com- petence shifts - a movement away from all the traditional management models associated with organized capitalism and towards a model of communicative management associated with an era of global capitalism. Conclusion The social democratic model of 'Norden' was an attempt to find a mid- dle way between capitalism and state socialism. This formula lost some of its attraction with the downfall of Soviet communism and the rise of global capitalism. Corporatism and stakeholder management formed a model that provided guidance for western industrial and political managers during the epoch of organized capitalism. The German and US versions of this model have been particularly influential in the Nordic countries.

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  Globalization, Europeanization and the End of Scandinavian Social Democracy?

  • R. Geyer, C. Ingebritsen, J. Moses, R. Geyer, C. Ingebritsen, J. Moses(Authors)
  • 1999(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  What might the future hold? Despite notable policy changes, political support remains strong for most elements of the model; despite shifts in the neo-liberal direction by some social demo- cratic parties (that is, Norwegian Labour), parties of the Left continue to support the fundamental features of the model. Political institutions such as social corporatism have been weakened, but this has been the case primarily in Sweden; central bargaining arrangements in Denmark and Finland have not changed that much in the 1980s and 1990s and, arguably, have been strengthened in Norway (Wallerstein and Golden, forthcoming). As a recent study of corporatism in Sweden suggests, social corporatist arrangements that deal specifically with social welfare issues - consensus orientations among peak associations in govern- ment-mediated bargaining over social welfare policies - have not changed that much through the mid-1990s (Hoefer 1996). Moreover, a general emphasis on the 'active line', public infrastructure investment and education, combined with continued relatively high levels of social protection for a highly skilled workforce, is quite consistent with long-term growth prescriptions of human capital theory and a world of substantial international and regional financial integration (also see Boix, forthcoming). A belief in the inevitability of dismantlement of the Nordic welfare states and continued economic crises is probably not warranted.

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