Functionality, Limits and Contradictions of Active Labor Market Policies: The Case of Sweden in the 20th Century

Abstract

This paper studies the Active Labor Market Policies applied in Sweden in the third quarter of the 20th century. In particular, the central role of these proposals in the general economic policy framework developed by social democratic governments under the Rehn-Meidner Model, inner core of the so-called Swedish Model. On the one hand, this strategy was key to prevent solidarity wage policy, the central pillar of the social democratic economic project, from generating mass unemployment in certain industries and regions. However, it is doubtful that these policies could have been effective without the complement of mass public employment. On the other hand, this strategy had serious consequences for certain sectors of the working class: in some cases, they were pushed into forced domestic migration, and, in others, they were forced to change industries and jobs. All this, to promote the competitiveness of Swedish capital, the ultimate beneficiary of the model.