A changed welfare-state: Sweden through the 1980s
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This thesis seeks to contribute to the important debate regarding whether who governs matter, and if the relationship between the government and labor unions affect economic performance. The research question is: "Did changes in the organization of labor in the 1980s lead to changes in the partisan influence on economic outcomes in Sweden in the 1990s?" To answer this a case-study of Sweden centered around the 1980s is conducted, a period in which this highly social democratic country underwent several changes to its economic system; a shift away from its corporatist roots. Corporatism, the cooperation between government and labor unions, is first examined theoretically through identification of partisan strategies for growth and class alignment. These are situated in a European context between 1975 and 1995, and the Swedish welfare- model is discussed. Further, the case-study shows how Sweden developed from a post-war welfare-system to a notably less corporatist system by the end of this period. Sweden is historically regarded as an example of a markedly corporatist country, and in Europe it is thus an unexpected case of a decline in corporatism. The thesis shows how changes to the organization of labor in the 1980s had consequences for economic performance, and this performance is discussed in the context of Europe, Scandinavia, and Sweden. The economic performance of the 1990s is related to changes in the 1980s, and the development between the periods analysed using a path-dependent methodological perspective. The development illustrates how the decline in Swedish corporatism had implications for subsequent performance. In the 1980s this is best explained by the dissolvement of centralized bargaining between labor unions and employer organizations. The institutional linkage between the left-party and labor, which remained strong from the 1950s to the start of the 1980s, appears weakened as a result of shifts in government power. With this came new policies, and the economic system moved towards market liberalism. Economic turmoil increased in the 1990s, starting with a banking crisis spanning Scandinavia, and the cause of this is traced to policies of the preceding decade. In a country with a long history of stable economic performance through cooperation between a leftist government and an encompassing labor, these changes and shocks were not expected, but they point to a broader decline in corporatism; a result of economic crises and changes to the political control over the economy.