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The politics of profits: Profit squeeze and political-economic change in Sweden, 1975–1985

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  • Bengtsson, Erik

    (Department of Economic History, Lund University)

Abstract

In the late 1970s, the Swedish economy faced a profit squeeze which threatened to hamper investments and hence the creation of jobs. This engendered a massive debate in the media and among economists and policymakers. This paper investigates the discussion of “the politics of profits”, the policy measures directed towards manipulating the distribution between capital income and labour income in the Swedish economy from the mid-1970s to the mid-1980s. The paper indicates that the capital-labour distribution varied significantly over time and that this became a major issue of debate, and shows the relevance of “the politics of profits” for analyses of economic policy change in the 1970s and 1980s.

Suggested Citation

  • Bengtsson, Erik, 2023. "The politics of profits: Profit squeeze and political-economic change in Sweden, 1975–1985," Lund Papers in Economic History 250, Lund University, Department of Economic History.
    • Handle: RePEc:hhs:luekhi:0250
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    References listed on IDEAS

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    1. Martin Lettau & Sydney C. Ludvigson & Sai Ma, 2019. "Capital Share Risk in U.S. Asset Pricing," Journal of Finance, American Finance Association, vol. 74(4), pages 1753-1792, August.
    2. Erik Bengtsson, 2015. "Wage restraint in Scandinavia: during the postwar period or the neoliberal age?," European Review of Economic History, European Historical Economics Society, vol. 19(4), pages 359-381.
    3. Claes Belfrage & Markus Kallifatides, 2018. "Financialisation and the New Swedish Model [Ownership and control in Sweden: strong owners, weak minorities and social control]," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 42(4), pages 875-900.
    4. Lennart Erixon, 2018. "Progressive supply-side economics: an explanation and update of the Rehn-Meidner model [Good jobs versus bad jobs]," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 42(3), pages 653-697.
    5. Moene, K.O. & Wallerstein, M., 1995. "How Social Democracy Worked: Labour Market Institutions," Memorandum 1995_010, Oslo University, Department of Economics.
    6. Karl Ove Moene & Michael Wallerstein, 1995. "How Social Democracy Worked: Labor-Market Institutions," Politics & Society, , vol. 23(2), pages 185-211, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    economic policy; Sweden; macroeconomics; history of capitalism; mixed economy;
    All these keywords.

    JEL classification:

    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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