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The Norwegian Oil Bonanza and the Scandinavian Model in Comparative Perspective

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  • Roberto Iacono

    (Norwegian University of Science and Technology)

Abstract

This paper aims at highlighting the effects of large natural resource endowments on the institutions of the so-called Scandinavian or Nordic model, through a comparative quantitative case study. Focusing on two key features of the Scandinavian model, namely (a) low income inequality and (b) high welfare spending, this study presents evidence on the shocks to these features for Norway after the country became one of the world’s largest oil exporters. A synthetic control unit constructed by weighting Nordic countries provides the most reliable comparison unit to estimate the comparative effects constituting the paper’s twofold contribution. First, the resource windfall did not contribute to significantly higher top income shares. Second, resource revenues contributed to finance the steadily increasing gap between Norway and other Nordic countries in the degree of welfare generosity.

Suggested Citation

  • Roberto Iacono, 2019. "The Norwegian Oil Bonanza and the Scandinavian Model in Comparative Perspective," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(1), pages 63-82, March.
    • Handle: RePEc:pal:compes:v:61:y:2019:i:1:d:10.1057_s41294-018-0071-7
    DOI: 10.1057/s41294-018-0071-7
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    Cited by:

    1. Christopher Hartwell & Roman Horvath & Eva Horvathova & Olga Popova, 2022. "Natural resources and income inequality in developed countries: synthetic control method evidence," Empirical Economics, Springer, vol. 62(2), pages 297-338, February.

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    More about this item

    Keywords

    Scandinavian model; Resource revenues; Comparative quantitative case study;
    All these keywords.

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)

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