Economic Integration

“Admire the best, forget the rest”—Sept 7, 2006, The Economist

• “Admire the best, forget the rest”—Sept 7, 2006, The Economist
• The Scandinavian countries have the world’s highest taxes and the most generous welfare benefits
• Sweden, Finland and Denmark have a strong growth and low unemployment
• Sweden’s big companies such as Ericsson, Volvo are breaking export records 2005
• Well-managed, export-driven, high-tech companies and its well-educated workforce.
• Female participation is the highest
• Weaknesses:
• High unemployment rate
• No new jobs, especially in the private sector
• Labor market is heavily regulated
• Powerful unions (enforcing min wage)
• Public sector—30% of employment in the public sector
• There is never a single economic model for other countries to follow. Neither membership of the EU nor adoption of the euro seems necessary: Sweden is in the EU, but not the euro, Finland is in both, Norway is neither. Different countries have different strengths:
• Finland—education; Denmark—labor mkt; Sweden’s management of big companies, Norway’s oil.
• The right conclusion is that it is wisest not to look for a single country model at all, but just to take best practice wherever you find it