This PDF is a selection from an out-of-print volume from the National Bureauof Economic Research

Volume Title: The Welfare State in Transition: Reforming the Swedish Model

Volume Author/Editor: Richard B. Freeman, Robert Topel, and Birgitta Swedenborg,editors

Volume Publisher: University of Chicago Press

Volume ISBN: 0-226-26178-6

Volume URL: http://www.nber.org/books/free97-1

Publication Date: January 1997

Chapter Title: Front matter, table of contents, acknowledgment

Chapter Author: Richard B. Freeman, Robert Topel, Birgitta Swedenborg

Chapter URL: http://www.nber.org/chapters/c6517

Chapter pages in book: (p. -11 - 0)

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The Welfare State in Transition

A National Bureau of Economic Research Conference Report

The Welfare State in Transition Reforming the Swedish Model

Edited by Richard B. Freeman, Robert Topel, and Birgitta Swedenborg

The University of Chicago Press

Chicago and London

RICHARD B. FREEMAN holds the Herbert Ascherman Chair in Economics at Harvard University. He is also director of the Labor Studies Program at the National Bureau of Economic Research and executive programme director for the Programme in Discontinuous Economics at the London School of Economics’ Centre for Economic Performance. ROBERT TOPEL is the Isidore Brown and Gladys J. Brown Professor in Urban and Labor Economics at the University of Chicago and a research associate of the National Bureau of Economic Research. BIRGITTA SWEDENBORC is deputy director of SNS, the Center for Business and Policy Studies, Stockholm, Sweden.

The University of Chicago Press, Chicago 60637 The University of Chicago Press, Ltd., London 0 1997 by the National Bureau of Economic Research All rights reserved. Published 1997 Printed in the United States of America 0 6 0 5 0 4 0 3 0 2 0 1 0 0 9 9 9 8 9 7 1 2 3 4 5 ISBN: 0-226-26178-6 (cloth)

Library of Congress Cataloging-in-Publication Data

The welfare state in transition: reforming the Swedish model / edited by Richard B. Freeman, Robert Topel, and Birgitta Swedenborg.

p. ence report)

cm. - (A National Bureau of Economic Research confer-

Includes bibliographical references and index. ISBN 0-226-26178-6 (cloth : alk. paper) 1. Sweden-Economic conditions- 1945- -Congresses. I. Free-

man, Richard B. (Richard Barry), 1943- . 11. Topel, Robert H. 111. Swedenborg, Birgitta, 1941- . IV. Series: Conference report (Na- tional Bureau of Economic Research) HC375.W34 1997 330.9485’059-dc21 96-50195

CIP

8 The paper used in this publication meets the minimum requirements of the American National Standard for Information Sciences-Permanence of Paper for Printed Library Materials, ANSI 239.48-1984.

National Bureau of Economic Research

Officers Paul W. McCracken, chairman John H. Biggs, vice chairman Martin Feldstein, president and chief

Gerald A. Polansky, treasurer secretary

Sam Parker, director offnance and corporate

Susan Colligan, assistant corporate secretary Deborah Mankiw, assistant corporate

secretary

executive officer

Directors at Large Peter C. Aldrich Elizabeth E. Bailey John H. Biggs Andrew Brimmer Carl F. Christ Don R. Conlan Kathleen B. Cooper Jean A. Crockett

George C. Eads Martin Feldstein George Hatsopoulos Karen N. Horn Lawrence R. Klein Leo Melamed Merton H. Miller Michael H. Moskow

Robert T. Pany Peter G. Peterson Richard N. Rosett Bert Seidman Kathleen P. Utgoff Donald S. Wasseman Marina v. N. Whitman John 0. Wilson

Directors by University Appointment George Akerlof, California, Berkeley Jagdish Bhagwati, Columbia William C. Brainard, Yale Glen G. Cain, Wisconsin Franklin Fisher, Massachusetts Institute of

Saul H. Hymans, Michigan Marjorie B. McElroy, Duke

Joel Mokyr, Northwestern Andrew Postlewaite, Pennsylvania Nathan Rosenberg, Stanford Harold T. Shapiro, Princeton Craig Swan, Minnesota

Arnold Zellner, Chicago Technology David B. Yoffie, Harvard

Directors by Appointment of Other Organizations Marcel Boyer, Canadian Economics

Mark Drabenstott, American Agricultural

William C. Dunkelberg, National Association

Richard A. Easterlin, Economic History

Gail D. Fosler, The Conference Board A. Ronald Gallant, American Statistical

Robert S. Hamada, American Finance

Charles Lave, American Economic

Rudolph A. Oswald, American Federation of

Association Association

Economics Association Association

of Business Economists

Association

Labor and Congress of Industrial Organizations

CertiJied Public Accountants Gerald A. Polansky, American Institute of

Josh S . Weston, Committee for Economic Association Development

Directors Emeriti Moses Abramovitz Franklin A. Lindsay George B. Roberts George T. Conklin, Jr. Paul W. McCracken Eli Shapiro Thomas D. Flynn Geoffrey H. Moore William S . Vickrey

James J. O’Leary

Since this volume is a record of conference proceedings, it has been exempted from the rules governing critical review of manuscripts by the Board of Directors of the National Bureau (resolution adopted 8 June 1948, as revised 21 November 1949 and 20 April 1968).

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Contents

1.

2.

3.

4.

5.

6.

7.

Acknowledgments

Introduction Richard B. Freeman, Robert Topel, and Birgitta Swedenborg

Generating Equality and Eliminating Poverty, the Swedish Way Anders Bjorklund and Richard B. Freeman

Public Employment, Taxes, and the Welfare State in Sweden Sherwin Rosen

Tax Policy in Sweden Erik Norrman and Charles E. McLure Jr.

Wage Policy and Restructuring: The Swedish Labor Market since 1960 Per-Anders Edin and Robert Topel

The Effects of Sweden’s Welfare State on Labor Supply Incentives Thomas Aronsson and James R. Walker

An Evaluation of the Swedish Active Labor Market Policy: New and Received Wisdom Anders Forslund and Alan B . Krueger

Taxes and Subsidies in Swedish Unemployment Lars Ljungqvist and Thomas J. Sargent

ix

1

33

79

109

155

203

267

299

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viii Contents

8. The Social Costs of Regulation and Lack of Competition in Sweden: A Summary Stefan Folster and Sam Peltzman

Industrial Policy, Employer Size, and Economic Performance in Sweden 353 Steven J. Davis and Magnus Henrekson

A Heckscher-Ohlin View of Sweden Competing in

Edward E. Learner and Per Lundborg

Contributors 465

Author Index 467

Subject Index 47 1

315

9.

10. the Global Marketplace 399

Acknowledgments

The contributions in this volume are the result of a major research project on the Swedish welfare state organized jointly by the Center for Business and Policy Studies (SNS) in Sweden and the National Bureau of Economic Re- search (NBER) in the United States.

SNS is a private, nonpartisan, nonprofit organization with the aim of pro- moting research on economic and social issues of importance to public deci- sion makers and making it readily available to a broad audience. As an organi- zation SNS does not take a stand on policy matters.

The project was initiated by SNS in 1991. SNS turned to the NBER to obtain a qualified outside perspective on the Swedish economy at a time when severe problems were building up in the Swedish economy. Although the project brought together American and Swedish economists as coauthors, the re- searchers were asked to maintain an American or outside perspective on the issues. The research was finalized in 1994 and presented at a public conference in Sweden in January 1995.

The research for this volume has been made possible by financial support from the following sources: the Jan Wallander and Tom Hedelius Foundation, the Swedish Council for Research in the Humanities and Social Sciences, the Axel and Margret Ax:son Johnson Foundation, the Swedish Council for Social Research, the Marianne and Marcus Wallenberg Foundation, the Marcus and Amalia Wallenberg Foundation, the Wenner-Gren Center Foundation for Sci- entific Research, the National Bureau of Economic Research, and the Sven and Dagmar Saltn Foundation.

ix

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