Sweden's Welfare State: Can the Bumblebee Keep Flying?

Books, May 1, 2003

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Sweden's Welfare State: Can the Bumblebee Keep Flying?

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Bibliographic details

• Authors: Subhash Madhav Thakur, Valerie Cerra, Balázs Horváth, Michael Keen
• Published: May 1, 2003
• Series: Books
• DOI: https://doi.org/10.5089/9781589061583.071

Overview

• Sweden is portrayed as epitomizing a welfare-state approach with extensive state intervention aimed at ensuring a high quality of life.
• Contrasting views:
  • Advocates: Swedish welfare state builds on a strong social consensus favoring extensive state intervention.
  • Critics: The system is marked by excessive government intervention and attendant inefficiencies.
• Metaphor used by Prime Minister Göran Persson: "Think of a bumblebee. With its overly heavy body and little wings, supposedly it should not be able to fly--but it does." The book treats the Swedish welfare state as the bumblebee that has managed to fly.
• Purpose of the book:
  • Draws on many years of IMF surveillance and policy advice to explain how the Swedish model has succeeded.
  • Assesses the challenges the Swedish model faces in the new century.
  • Proposes a strategy for dealing with those challenges.
  • Draws lessons for other countries facing similar challenges from globalization and demographics.

Key findings and analysis

• The book synthesizes IMF surveillance and policy advice to explain the resilience of the Swedish welfare model.
• Focus areas reflected in subject keywords:
  • Corporate income tax; Corporate taxes; Revenue administration; Taxes
  • Expenditure; General government expenditure
  • Income; earnings distribution; per capita income; transfer income
  • Labor; Labor markets; wage; wage dispersion; ICT sector
  • National accounts; user cost of capital; tax depreciation allowance
• Geographic and thematic scope in keywords:
  • Baltics; Europe; Northern Europe; Western Europe; Global; Sweden; report Sweden; BOOK; growth performance

Challenges identified and strategic policy focus

• Challenges motivating the analysis:
  • Globalization
  • Demographics
• Strategic objectives articulated:
  • Explain how the Swedish welfare state has operated successfully.
  • Assess pressures and vulnerabilities in the Swedish model in the 21st century.
  • Propose policy strategy to address identified challenges.
  • Extract lessons applicable to other countries facing similar globalization and demographic pressures.