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THE ECONOMIC AND SOCIAL RESEARCH INSTITUTErr~ MEMORANDUM SERIES NO. 108 r k . k , . ¯ . k ") , . .r ¯ , ¯: ~ ¯ ,~ t, ¯ T k k IMPRESSIONS OF SWEDEN ¯ . " r 1 Robert O’Connor Pat Mangan -k ¯ - - L " ¯ " ¯i" L Confidential: ~ Not to be quoted until the permission ~of the Author and the Institute is obtained. k . ~. r ¯ r ¯ ,. L ¯ ¯ , . ¯ . ¯. IMPRE SSIONS OF SWEDEN Robert O’Connor As one flies in over Sweden it is difficult to see any cleared land, there is forest everywhere. Coming closer however, one sees small patches of farm land obtruding through the forest with red farmhouses tucked away in the trees. I understand that an earlier king of Sweden held the franchise for red paint and the custom, introduced by edict at that time, has remained. As one travels through Sweden one is immediately struck by the quality of the highways. They are easily on par with those in the USA and Canada. The density of motor traffic on the roads, however, is low and particularly in the cities, where one would expect very heavy traffic. This can be explained on two grounds. The density of population in the country as a whole is low and . 2. Bicycle traffic in the cities seems to be as heavy as it was in Dublin during war years. There are bicycle parks everywhere. The Swedes are very worried about road accidents. Most cars travel in the daytime on full lights. All bicycles have luminous painted flags sticking out behind, while a person who has imbibed more than one bottle of beer may not drive a car. The penalties for driving after drinking are very severe. The laws relating to drunken driving spring as much from historical circumstances as from road accidents. Down the years, Sweden has had a drink problem. The potato was introduced into that country in the 18th Century, not as a food crop, but as the raw material for the making of spirits on practically every farm. Indeed it took many years to make the eating of potatoes widespread because they were not mentioned in the bible. The drii~k problem persists in Sweden even to this day despite punitive taxation of alcohol of all kinds. A bottle of beer in Sweden now costs £1 and a whiskey and soda over £2. This compared with £8 for bed and breakfast in a Class A hotel and £4 in a Class B hotel. Indeed prices generally in Sweden are not much higher than here, while as will be shown later, incomes generally are much higher. A secondary teacherts salary is £6,000 - £8,000, while a university professor earns about £12,000 per annum. FACTS ABOUT SWEDEN Pat Mangan Introduction Sweden with an area of 174,000 square miles is the largest Scandinavian comltry and fourth largest in I~urope. It is almost a thousand miles in length. Over half of its area is covered by forests and less than one-tenth is arable land. About one-sixth of its area lies within the arctic circle. As can be seen from Table 1 its population is 8.2 millions, of which 4 millions are in the labour force. The birth rate has been low and the rate of population increase slow. In fact about half of the population increase has been accounted for by immigration. About two-thirds of immigrants are from other Scandinavian countries, hnmigrants number about 7 per cent of the total population. Table I: Facts about Sweden 1965 1970 1974 Population at end of year, (1,000) 7,772 8,081 8,177 2 Number of inhabitants per km 17 18 18 Gainfully employed, (1,000) 3,740 3,850 3,960 Percentage Distribution of GNP by Sectors PerCe~ Agriculture, Forestry, Fishing 11.3 8.1 6.7 Mining and Manufacturing 33.8 28.8 29.6 Construction 9.0 9.6 7.4 Trade 15.0 14.4 14.1 Transportation 7.1 6.9 6.8 Banking and Insurance 3.9 5.0 5.4 Public Administration and Other Services 19.8 27.1 30.0 + Population density is about 52 persons per square mile (20 per square l~rn.), but this is very unevenly distributed, with about 90 per cent of the total population being located in the southern half of the com~try. The percentage distribution of GNP by sectors is also shown in Table 1. -2- The Standard of Living Wage levels in Sweden are high, as can be seen by looldng at Table 2. Table 2. Total wage cost per working hour in manufacturing for men mad women in Swedish Kroner 1960 1965 1970 1973 Sweden 6.50 9.90 15.60 21.90 Federal Germany 4.60 7.60 12.60 20.20 U.K. 4.70 6.40 8.70 10.90 France 4.40 6.40 9.00 13.70 U.S.A. 13.90 16.40 22.00 22.70 Japan 1.40 2.80 5.70 10.70 Ireland 1.67 2.46 4.15 6.63 This table was based on an exchange rate against £ sterling of £1 = S. Kr. 10.40. A division by 10 will give a rough sterling equivalent. Present exchange rate is £1 = 9.04 S.Kr. (10 October 1975). Women’s average earnings had by 1973 reached an average of 84 per cent of male earnings in industrial employment. A distribution of employees by income group is given in Table 3. Table 3: Distribution of employees by income group 1973 No Income Under £1,000 - £2,000 - £3,000 - £4, 000 - £6, 000 - £10,000 + Registered £1,000 £2, 000 £3,000 £4,000 £6, 000 £10,000 Per Cent Male 3, 6 6. 4 11.2 18. 8 3!. ! 21. 0 6. 4 1.6 Female 6. S 24.3 26. 5 23.8 13. 5 4. 8 0. 6 0. 1 Total 5.0 14. 6 18.0 20.9 23.1 13.7 3. 8 0. 9 A comparison of GNP reveals that in 1972 Sweden had, according to the World Bank, a per capita GNP of almost $4,500 compared with figures of $5,590 for the -3- United States, $3,390 for West Germany, and $1,580 for Ireland. (see Table 4). Table 4: Per Capita GNP at market prices (1972) and growth rates, 1960-1972 and 1965-1972. Per Capita Percentage Percentage Country GNP US$ Growth Rate Growth Rate 1972 1960-72 1965-72 Sweden 4,480 3.2 2.5 Norway 3,340 4.0 3.8 Denmark 3,670 3.8 3.7 Federal Germany 3,390 3.7 4.1 France 3,620 4.7 4.8 United Kingdom 2,600 2.3 2.0 United States 5,590 3.0 2.0 Switzerland 3,940 2.9 2.9 Japan 2,320 9.4 9.7 Ireland 1,580 3.5 3.7 Source: World Bank Atlas, 1972. Indicators of economic standards also reveal the high stm]dard of living enjoyed by the average Swede. This must also be taken in conjunction with the high social welfare standards set in that country. See Tables 5,6 and 7. Table 5: Indicators (consumption) 1972 Energy Steel Calories Country teeI kg. cse2 per capita _per capita per annum per day~ Sweden 7,535 686 2,792 Norway 8,593 451 2,937 Denmark 5,629 442 3,261 France 4,550 456 3,202 Federal Germany 5,753 648 3,247 United Kingdom 5,496 406 3,115 United States 11,440 663 3,345 Ireland 3,372 156 3,398 1. Tons of coal equivalent 2. I~los of crude steel equivalent 3. 1971. -4- Table 6: Indicators (medical per i00,000 population) Doctors Pharmaci sts Hospital Beds Country (1971) (1971) (1972) Sweden 136 34 1,495 Norway 146 34 1,119 Denmark 146 41 915 France 1’34 63 941 Federal Germany 178 37 i, 126 United Kingdom 129 31 944 United States 155 61 789 Ireland 104 57 1,260 Table 7: Indicators (per 1,000 population) Passenger Cars Country Telephones Televisions i January 1973 1 January i972 Sweden 302 557 323 Norway 216. 307 229 Denmark 240 356 283 France 268 185 226 Federal Germany 264 249 270 United Kingdom 234 289 298 United States 460 604 449 Ireland 146 109 166 -5- Reasons for Economic Growth Sweden’s economic growth has been long and sustained and can be attributed to a number of factors:- She has extensive natural resources of ore, timber and water power, . all of which give her a natural advantage. Her rapid population growth in the nineteenth century was alleviated by massive emigration to North America. Thus there was no serious overpopulation problem. The country has been at peace since 1815 and through her neutral stance avoided the destruction of both world wars. There has ’been an absence of serious social problems. Productivity . has continued to rise and labour unrest has been kept at a minimum through centrally negotiated wage agree~ments. o There has been a sustained demand for Sweden’s produce on the export market, especially as her production became more specialised. Some Important Industries The volume of industrial production has risen an average of 4.7 per cent per annum between 1950 and 1960, by 7.6 per cent between 1960 and 1965, 5.4 per cent in the period 1965 to 1970 and back again to 4.7 per cent in the years 1970 to 1974. The highest average growth rates have been in the wood, engineering and iron and steel industries.