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Interregional Migration, Wages and Labor Market Policy: Essays on the Swedish Model in the Postwar Period
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Economic History.ORCID iD: 0000-0003-3427-5515
2017 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The Swedish model is perceived as a successful framework for combining rapid labor market adjustment with low inequality. Formulated by Gösta Rehn and Rudolf Meidner and implemented from the 1950s, it has been associated with the peak in economic restructuring and interregional migration during the 1960s. However, there is little empirical evidence for this. This thesis consists of an introduction and four essays. It explores three aspects of the model from a long-run perspective: interregional migration, wage dispersion and labor market policy.

Essay I uses new data to track interregional migration rates in the postwar period (1945-1985). The results show that the responsiveness of interregional migration to local labor market conditions remained stable over time; it was neither higher during the 1960s nor lower when migration declined after 1970.

Essay II employs a regression-decomposition framework to analyze the evolution of wage dispersion. The results suggest that wage dispersion was stable from centralized bargaining’s introduction in 1956 to the late 1960s. Afterwards, there was a rapid decline, likely because of solidaristic bargaining.

Essay III contrasts the implementation of the active labor market policy to regional policy. Following a decisive shift around 1970, the focus on north to south mobility was replaced with policies to stimulate northern employment. Declining rural support for the Social Democrats and electoral competition from the Center Party caused this shift.

Finally, Essay IV is a case study about mobility subsidy usage in Västernorrland County using sources on relocation allowances from 1965, 1970 and 1975. The results indicate that in the 1960s there was strong selection into the program by young persons with good labor market prospects. However, the program’s use did not change after the regional policy shift in the early 1970s.

The collective results suggest that the policies associated with the Swedish model were minor for economic restructuring patterns. The migrations of the 1960s and the decline in regional disruptions after 1970 should instead be explained by studying the consequences of structural changes, how regions were progressively affected differently and the possible role that government policies played in directing demand for labor across space.

Place, publisher, year, edition, pages
Uppsala: Acta Universitatis Upsaliensis , 2017. , p. 79
Series
Uppsala Studies in Economic History, ISSN 0346-6493 ; 111
Keywords [en]
Swedish model, postwar period, interregional migration, wages, labor market policy, regional restructuring, economic growth, structural change, solidaristic wage policy, relocation allowances, regional policy
National Category
Economic History
Research subject
Economic History
Identifiers
URN: urn:nbn:se:uu:diva-324443ISBN: 978-91-513-0002-3 (print)OAI: oai:DiVA.org:uu-324443DiVA, id: diva2:1110384
Public defence
2017-09-08, Hörsal 2, Ekonomikum, Kyrkogårdsgatan 10, Uppsala, 13:15 (Swedish)
Opponent
Supervisors
Funder
The Jan Wallander and Tom Hedelius Foundation, P2013-0274:1Available from: 2017-08-14 Created: 2017-06-15 Last updated: 2017-09-08
List of papers
1. Local Labor Markets and Regional Mobility in Sweden: Evidence from New County Level Data, 1945–1985
Open this publication in new window or tab >>Local Labor Markets and Regional Mobility in Sweden: Evidence from New County Level Data, 1945–1985
2017 (English)Article in journal (Refereed) Submitted
National Category
Economic History
Research subject
Economic History
Identifiers
urn:nbn:se:uu:diva-322610 (URN)
Funder
The Jan Wallander and Tom Hedelius Foundation, P2013-0274:1
Available from: 2017-05-27 Created: 2017-05-27 Last updated: 2017-06-15
2. Regional Wages, Economic Restructuring and the Solidaristic Wage Policy in Sweden
Open this publication in new window or tab >>Regional Wages, Economic Restructuring and the Solidaristic Wage Policy in Sweden
2017 (English)Article in journal (Refereed) Submitted
Abstract [en]

The solidaristic wage policy in Sweden, negotiated by peak organizations on the labor market between 1956 and 1983, has been associated with a decrease in wage differences across regions, leading to the interregional migration flows that culminated during the 1960s. While the effects of the solidaristic wage policy have been widely discussed, there is little evidence on the actual evolution of regional wages and its effect on economic restructuring, especially before the 1970s. Using new regional wage data, I examine the evolution of wage dispersion and analyze the changes using a regression-decomposition framework. The results show that wage inequality was stable before 1968, then it rapidly declined. According to the decomposition, this decline was also likely the result of deliberate union policy. However, the wage policy cannot explain the height of regional restructuring in the 1960s since it is unlikely to have affected the wage structure at the time.

National Category
Economic History
Research subject
Economic History
Identifiers
urn:nbn:se:uu:diva-324440 (URN)
Funder
The Jan Wallander and Tom Hedelius Foundation, P2013-0274:1
Available from: 2017-06-15 Created: 2017-06-15 Last updated: 2017-06-15
3. What can the State do for you?: Relocation Allowances and Regional Subsidies in Post-War Sweden
Open this publication in new window or tab >>What can the State do for you?: Relocation Allowances and Regional Subsidies in Post-War Sweden
2017 (English)In: Scandinavian Journal of History, ISSN 0346-8755, E-ISSN 1502-7716, Vol. 42, no 3, p. 273-298Article in journal (Refereed) Published
Abstract [en]

It has been suggested that Swedish policy during the early postwar period was strongly directed towards mobility increasing expenditures, most notably relocation allowances, aimed at moving labor from north to south. While this view has dominated the academic discussion on labor market policy there is little direct evidence. We make three claims. First, the relocation allowances have to be evaluated against the regional policy. Second, by doing so we show that the mobility oriented policy was predominant only for a short period of time. In the early 1970s, there was a decisive shift towards a policy directed at stimulating employment in the north. Third, drawing on this, we reevaluate the previous view on policy making in Sweden. Our analysis suggests that the Social Democratic government acted in a voter maximizing way. The relocation allowances were introduced at the behest of the Trade Union Confederation (LO). The regional subsidies were expanded when voter sentiment turned against the perceived depletion of rural regions. However, this strategy interacted with the political and institutional environment. The new election law in 1970 and political competition from the Center Party pushed the Social Democrats to shift their policies on regional subsidies.

Place, publisher, year, edition, pages
Taylor & Francis Group, 2017
Keywords
‘Swedish model’, subsidies, relocation allowances, regional policy, post-war period, economic history
National Category
Economic History
Research subject
Economic History
Identifiers
urn:nbn:se:uu:diva-321047 (URN)10.1080/03468755.2017.1318337 (DOI)000402986900002 ()
Funder
The Jan Wallander and Tom Hedelius Foundation, P2013-0274:1
Available from: 2017-04-28 Created: 2017-04-28 Last updated: 2017-09-08Bibliographically approved
4. Implementing National Structural Change at the Local Level: The Case of Relocation Allowances in Västernorrland, 1965–1975
Open this publication in new window or tab >>Implementing National Structural Change at the Local Level: The Case of Relocation Allowances in Västernorrland, 1965–1975
2017 (English)Manuscript (preprint) (Other academic)
Abstract [en]

The Swedish model was built on the notion that mobility from high- to low-unemployment areas could be achieved without large wage differentials if active labor market policy was used to aid in the movements across places. While Sweden pioneered the use of relocation allowances on a large scale in the late 1950s, very little is known about the actual implementation of this program. Its role during the large out-migrations from northern Sweden during the 1960s is especially underresearched. In this essay, I study the usage of the program through a case study of  Västernorrland county from 1965 to 1975. The analysis shows that in the 1960s there was a strong selection into the program by younger persons, newly examined students and from certain sectors. After 1970, there was a shift in government policy with the aim of reducing the outflow of migrants from the northern counties and to keep allowance migration within counties. Between 1970 and 1975 there was also a drop in both regular and allowance out-migration by 20 %. Within the group of allowance migrants, however, there was no change in the likelihood of staying within Västernorrland after controlling for age, sex and occupation. The share of out-migrations that took place with support from the program also remained constant at 20 %. This suggests that the decline in out-migration was probably not caused by lower mobility but was rather more likely the consequence of structural change and alterations to public policy after 1970, which improved the labor market situation in the northern counties. 

National Category
Economic History
Research subject
Economic History
Identifiers
urn:nbn:se:uu:diva-324441 (URN)
Funder
The Jan Wallander and Tom Hedelius Foundation, P2013-0274:1
Available from: 2017-06-15 Created: 2017-06-15 Last updated: 2017-06-15

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