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Does the Welfare State Harm Economic Growth? Sweden as a Strategic Test Case

In: Social Policy and Economic Development in the Nordic Countries

Author

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  • Walter Korpi

Abstract

On a world-wide scale, economic growth rates declined markedly after the mid-1970s. In many Western countries, politicians and economists argued that the main causes for this slowdown could be traced back to distorting effects of their welfare states. Such diagnoses were often used to support significant limitations and cuts in social provisions. Welfare states are of major relevance for distribution and redistribution of economic resources among citizens in Western countries. For social scientists, it is therefore of importance to assess to what extent there is an empirical base for the hypothesized negative growth consequences of welfare states. This is important, perhaps especially for those who tend to promote welfare state policies. If major negative consequences remain unrecognized, or nothing is done to abate them, the legitimacy of the welfare state, at least in the long run, is undercut.

Suggested Citation

  • Walter Korpi, 2005. "Does the Welfare State Harm Economic Growth? Sweden as a Strategic Test Case," Social Policy in a Development Context, in: Olli Kangas & Joakim Palme (ed.), Social Policy and Economic Development in the Nordic Countries, chapter 8, pages 186-209, Palgrave Macmillan.
    • Handle: RePEc:pal:sopchp:978-0-230-52350-0_8
    DOI: 10.1057/9780230523500_8
    as

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