How Laissez-Faire Made Sweden Rich (2013)
libertarianism.org
How Laissez-Faire Made Sweden Rich (2013)
1–10 of 43 posts
Re: How Laissez-Faire Made Sweden Rich (2013)
#2Liassez-Faire may have made Sweden rich but most western countries went from a poor state 150 years ago to prosperous now pretty much regardless of the political systems they had. Even Russia did kind of ok. I think the advances were driven by improvements in technology more than anything else.
Re: How Laissez-Faire Made Sweden Rich (2013)
#3Personal anecdote and gross generalization: people who consider Sweden or the other Nordic countries socialists are Americans or have been “Americanized” through consumption of US media. Don’t feel ashamed, I’m also one of these people.
These countries actually are social democracies: https://en.m.wikipedia.org/wiki/Social_democracy
Big difference based on just 1 word.
Also, Sweden was never truly poor, by world standards. You don’t have to believe me, check the Maddison Project. Even when it was “poor” 200 years ago, it was probably 100-200% richer than my home country, Romania, and probably another 100-200% richer than the truly poor parts of the world.
Re: How Laissez-Faire Made Sweden Rich (2013)
#4Liassez-Faire may have made Sweden rich but most western countries went from a poor state 150 years ago to prosperous now pretty much regardless of the political systems they had. Even Russia did kind of ok. I think the advances were driven by improvements in technology more than anything else.
The industrial revolution and (relative) free trade made that possible 150 years ago.
Also, the vast amount of resources required to industrialize thanks to colonialism also helped tremendously.
Re: How Laissez-Faire Made Sweden Rich (2013)
#5Liassez-Faire may have made Sweden rich but most western countries went from a poor state 150 years ago to prosperous now pretty much regardless of the political systems they had. Even Russia did kind of ok. I think the advances were driven by improvements in technology more than anything else.
Also, Sweden did not participate in any war since 1814. During the world wars the industries of most of Europe was ruined, and Sweden's industry got an enormous boost by being the only functioning one in europe.
Re: How Laissez-Faire Made Sweden Rich (2013)
#6If somebody is interested in a more data driven view, I would recommend this paper (1) by Ha-Joon Chang:
"This free trade phase, however, was short-lived. Sweden started using tariffs as a means to protect the agricultural sector from American competition since around 1880. After 1892, it also provided tariff protection and subsidies to the industrial sector, especially the newly-emerging engineering sectors [..]. Because of this switch to protectionism, the Swedish economy performed extremely well in the following decades"
"The Swedish state made great efforts in facilitating the acquisition of advanced foreign technology, including state-sponsored industrial espionage. However, more notable was its emphasis on the accumulation of “technological capabilities” [..]. It provided stipends and travel grants for studies and research, invested in education, helped the establishment of technological research institutes, and provided direct research funding to industry"
(1) - http://www.personal.ceu.hu/corliss/CDST_Course_Site/Readings...
Re: How Laissez-Faire Made Sweden Rich (2013)
#7Sweden did well after WW2 for much the same reason that the US did: it was industrialized and not destroyed.
It's always tempting to believe that there was something special about their "ideological prowess", but that isn't really the case. With or without laissez faire they would have done well. With or without a welfare state they would have done well.
Econ 101 is "people respond to incentives". Think tanks representing the rich and wealthy (of which libertarianism.org/CATO is one) have a strong incentive to try and give laissez faire credit for every positive economic development ever. It's what makes their donors wealthy.
The Kochs (a major source of funds for this website) would particularly like you to think this because of some of the truly epic fights that they have had with the environmental protection authority. To them, "regulation is bad, mkay". Guess why?
Hence why, even though I'm sure he honestly believes it, Johan Norburg gives free markets credit for Sweden solving their infant mortality problem.
Re: How Laissez-Faire Made Sweden Rich (2013)
#8Liassez-Faire may have made Sweden rich but most western countries went from a poor state 150 years ago to prosperous now pretty much regardless of the political systems they had. Even Russia did kind of ok. I think the advances were driven by improvements in technology more than anything else.
Improvements in technology are undoubtedly the centrepiece of any sane economic history theory of the last 5-10 generations, and longer. Interestingly enough... Liassez-Faire theories, marxist theories, or macroeconomic theories and other "Big Idea" economics don't tend to have a theory of innovation anywhere near the core of their concepts.
Re: How Laissez-Faire Made Sweden Rich (2013)
#9Liassez-Faire may have made Sweden rich but most western countries went from a poor state 150 years ago to prosperous now pretty much regardless of the political systems they had. Even Russia did kind of ok. I think the advances were driven by improvements in technology more than anything else.
> Even Russia did kind of ok.
That may be true from 10 thousand miles away. Upon closer inspection, there's a huge difference in current wealth and standard of living between Russia and say Finland, while 100 years ago they were roughly the same. Not to mention the unimaginable wealth of natural resources that Russia has, which, under proper political and economic policies, could make it into a Norway-like paradise.
Re: How Laissez-Faire Made Sweden Rich (2013)
#10This article leaves a lot out. For instance, the loss of population to North America. In the early 1900s Sweden had a population of 4 million and it also had a diaspora of 4 million. In other words, it had lost nearly half its people overseas. The ruling class was terrified by the loss of people and so subsidizes for housing were introduced. Sweden thus became the first Western nation to introduce housing subsidies. The subsidies were for a particular kind of house, of which several survive. You can see a few in Stockholm near certain parks.
But more so, the standard of living in Sweden remained well behind that of other Western nations till after World War II. The big increase in the standard of living was something that happened during the post war boom. All Western nations grew rapidly then, but Sweden was able to close the gap between itself and other Western nations. We could argue all day about whether the boom or the socialists deserve credit, but it seems clear that laissez faire had nothing to do with it.