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Generating equality and eliminating poverty the Swedish way

By A. Bjorklund and Richard B. Freeman

Abstract

Sweden has a remarkable record in reducing inequality and virtually eliminating poverty. This paper shows that: 1) Sweden achieved its egalitarian income distribution and eliminated poverty largely because of its system of earnings and income determination, not because of homogeneity of the population nor its educational system. 2) In the job market Sweden is distinguished by a relatively egalitarian distribution of hours of work among those employed, which may be an interrelated part of the Swedish economic system, and until the recent recession, by a high employment rate. 3) Tax and transfer policies contribute substantially to Sweden''s overall distribution record. In contrast to many social welfare systems, Sweden''s is largely a workfare system, providing benefits for those with some work activity. 4) Part of Sweden''s historic success in maintaining jobs for low wage workers while raising their wages resulted from policies that directly or indirectly buttress demand for low skill workers, notably through public sector employment. 5) Sweden''s tax and transfer policies have maintained the position of lower income workers and families, including those with children, during its recent economic decline

Topics: HN Social history and conditions. Social problems. Social reform, HV Social pathology. Social and public welfare. Criminology
Publisher: Centre for Economic Performance, London School of Economics and Political Science
Year: 1995
OAI identifier: oai:eprints.lse.ac.uk:20773
Provided by: LSE Research Online
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