LETTERS TO THE EDITOR

Summer 2007

by Jan Andersson

Sir,
In the debate over the future of Europe, the Nordic social model is attracting more and more attention, allowing discussion to break away from the traditional dichotomy between the continental model’s promise of high job security and the Anglo-Saxon fixation with economic growth at the expense of equality and social protection.

In her article, Lorraine Mullally concludes that the EU should learn from the Anglo-Saxon model rather than the Nordic one. I disagree. The Nordic model has much to contribute to our understanding of how EU member states can combine economic growth and global competitiveness with high social protection.

A useful illustration of this point can be found in comparisons between Sweden – an outstanding example of the success of the Nordic model, according to a range of economic statistics – and Ireland, a supposed champion of the Anglo-Saxon model.

For example, the World Economic Forum ranks Sweden as the second most competitive country in the world after Switzerland. Ireland trails at number 21 on the list, below even continental model countries.

Employment data, too, underline Sweden’s economic strengths compared with Ireland’s. Eurostat shows total employment in Sweden at 72.5% of the workforce, against 67.6% in Ireland. Female employment in Sweden is 70.4%, well above Ireland’s 58.3%. Such figures are both more useful and more interesting than the unemployment statistics quoted by Mullally.

Another striking comparison between the two countries is the risk of poverty and level of income inequalities. According to the European Commission, 20% of all Irish people are “at risk of poverty”, rising to 23% for children, substantially above the EU average. In Sweden where the generous system for maternity, paternity and parental leave is famous, the rate is 9%. The opposite is true in Ireland, where unpaid parental leave and the absence of paternity leave keep many women out of work.

Prof. André Sapir has categorized the European social model as consisting of four alternative systems, i.e. the continental, Anglo-Saxon, Nordic and Mediterranean models. His studies into their efficiency and equity found that both the Anglo-Saxon and Nordic models were well-equipped to face the challenges of globalisation and to create more open and competitive markets. But he identified a crucial difference – while the Anglo-Saxon option may be efficient, it is also inequitable. The Nordic model, therefore, offered the best performance overall.

Such research emphasises the need to take a broad view when comparing different social models in Europe. Obviously, growth and employment are important research criteria, but it is also essential to study the economic and social gaps between citizens and regions. If Mullally applied this broader perspective to ascertain each model’s ability to combine growth, job creation, equality and regional cohesion, she would find that the Nordic model is the most successful.