Nordic model

The Nordic model (also called Nordic capitalism or Nordic social democracy) refers to the economic and social policies common to the Nordic countries (Denmark, Finland, Norway, Iceland, the Faroe Islands and Sweden). This includes an underlying social foundation of a comprehensive welfare state and collective bargaining at the national level with a high percentage of workers belonging to labour unions combined with the tenets of free market capitalism; and state provision of free education and free healthcare as well as generous, guaranteed pension payments for retirees funded by taxation. The Nordic model began to earn attention after World War II.

Although there are significant differences among the Nordic countries, they all share some common traits. These include support for a "universalist" welfare state aimed specifically at enhancing individual autonomy and promoting social mobility; a corporatist system involving a tripartite arrangement where representatives of labor and employers negotiate wages and labor market policy mediated by the government; and a commitment to widespread private ownership, free markets and free trade.

Each of the Nordic countries has its own economic and social models, sometimes with large differences from its neighbours. According to sociologist Lane Kenworthy, in the context of the Nordic model "social democracy" refers to a set of policies for promoting economic security and opportunity within the framework of capitalism rather than a replacement for capitalism. In the case of Norway, being the state owner of key industrial sectors, it has been described as XXI century socialism.

"The Nordic Model – Embracing globalization and sharing risks" characterises the system as follows:

The Nordic countries share active labor market policies as part of a corporatist economic model intended to reduce conflict between labor and the interests of capital. The corporatist system is most extensive in Sweden and Norway, where employer federations and labor representatives bargain at the national level mediated by the government. Labor market interventions are aimed at providing job retraining and relocation.

The Nordic labor market is flexible, with laws making it easy for employers to hire and shed workers or introduce labor-saving technology. To mitigate the negative effect on workers, the government labor market policies are designed to provide generous social welfare, job retraining and relocation to limit any conflicts between capital and labor that might arise from this process.

This page was last edited on 31 May 2018, at 08:47 (UTC).
Reference: https://en.wikipedia.org/wiki/Nordic_model under CC BY-SA license.

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