How Laissez-Faire Made Sweden Rich (2013) • Hacker News Board

Re: How Laissez-Faire Made Sweden Rich (2013)

#11

Post by 127 » Sat, Mar 24, 2018, 12:49 PM UTC

p0ints wrote: post #9

tim333 wrote: post #2

Liassez-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.

And if you put the starting point of your charts to the end of communism, you will see a radical growth in the average wages and the quality of life of citizens.

Re: How Laissez-Faire Made Sweden Rich (2013)

#12

Post by pensativo » Sat, Mar 24, 2018, 12:50 PM UTC

People already poited out that a) Sweden wasn't very poor in the first place b) didn't participate much in conflict during the time; and, most importantly c) technology was extremely influential in the sense that there was just more to go around.

I want to point out that I think (c) is by far the most important fact but that the post ignores; however, it also ignores lesser factors such as the widespread participation and effects of labor unions.

I see the post as grossly oversimplifying (by conveniently ignoring many other historical factors) while the last time I check, this is something that's still very much debated by modern economists.

Re: How Laissez-Faire Made Sweden Rich (2013)

#13

Post by gohbgl » Sat, Mar 24, 2018, 12:57 PM UTC

dalbasal wrote: post #8

tim333 wrote: post #2

Liassez-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.

Undoubtedly, Laissez-Faire and socialist economies have different technology improvement rates.

Re: How Laissez-Faire Made Sweden Rich (2013)

#14

Post by hollerith » Sat, Mar 24, 2018, 1:01 PM UTC

dalbasal wrote: post #8

tim333 wrote: post #2

Liassez-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.

Maybe it's not that simple. The technological improvement that did the most to improve standards of living is learning how to use fossil fuels 300 years ago for transportation and to do other kinds of mechanical work, like pumping water out of mines. That improvement came out of what was then already the wealthiest country (on a per-capital basis). Moreover it was the country whose legal system offered the best protection for private property. That would be quite the coincidence if tech innovations have nothing to do with economic policies.

Re: How Laissez-Faire Made Sweden Rich (2013)

#15

Post by yostrovs » Sat, Mar 24, 2018, 1:05 PM UTC

p0ints wrote: post #9

tim333 wrote: post #2

Liassez-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.

Finland was part of Russia 100 years ago, which led to another experiment comparing systems for the next 70 years. The results are always the same.

Re: How Laissez-Faire Made Sweden Rich (2013)

#16

Post by [deleted] » Sat, Mar 24, 2018, 1:05 PM UTC

p0ints wrote: post #9

tim333 wrote: post #2

Liassez-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.

[deleted]

Re: How Laissez-Faire Made Sweden Rich (2013)

#17

Post by data_required » Sat, Mar 24, 2018, 1:06 PM UTC

Here is a better article on Sweden's economic history, with far more data backing it up: https://eh.net/encyclopedia/sweden-economic-growth-and-struc...

1. Sweden's economic growth relative to the rest of the world continued quite strongly for 40 years after the Social Democrats took power in 1932 and built a large welfare state.

2. In fact, the period with the strongest economic growth rate in absolute terms was 1950-1975, the period when laissez-faire was most clearly abandoned.

3. The libertarianism article doesn't once mention the absolutely crucial fact that Sweden did not participate in the two world wars. In fact, Sweden has been pacifist since the early 1800s. It really helps a lot when your country is not twice ravaged by major wars, and Sweden also makes a habit of investing more in its people.

4. The fact that Sweden and several other countries can sustain a rich economy with healthy and happy people, at the same time as it has high taxes, is itself a death knell for the claim that libertarianism is always and forever the best ideology. If something drastically different from libertarianism is most strongly associated with wealth & health, then libertarianism clearly isn't necessary.

The libertarianism article is not without merit (some kinds of trade liberalizaton and other liberal reforms were obviously a great idea in retrospect), but like most articles written by proponents of an ideology, it fails to acknowledge other important pieces of the puzzle.

Re: How Laissez-Faire Made Sweden Rich (2013)

#18

Post by mediascreen » Sat, Mar 24, 2018, 1:22 PM UTC

data_required wrote: post #17

Here is a better article on Sweden's economic history, with far more data backing it up: https://eh.net/encyclopedia/sweden-economic-growth-and-struc... 1. Sweden's economic growth relative to the rest of the world continued quite strongly for 40 years after the Social Democrats took power in 1932 and built a large welfare state. 2. In fact, the period with the strongest economic growth rate in absolute terms was 195…

While I agree that the question is more complicated, it took until 1974 before tax rates were anywhere near where they are today [0].

Also, while not involved in any wars, I'm not sure i would call Sweden pacifist during the last century. For example Sweden had the 4th largest airforce in the world in the 1950s [1]

And, except for tax rates, Sweden has a pretty liberal economy [2].

[0]http://www.scb.se/en/finding-statistics/statistics-by-subjec...

[1]https://en.wikipedia.org/wiki/Swedish_Air_Force#Expansion_du...

[2]https://www.heritage.org/index/country/sweden

Re: How Laissez-Faire Made Sweden Rich (2013)

#19

Post by usrusr » Sat, Mar 24, 2018, 1:35 PM UTC

kazen44 wrote: post #4

tim333 wrote: post #2

Liassez-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.

Did colonoalism, at the time, contribute much to industrialization in terms of resources? My impression is that during the age of steam, colonial trade/extraction was mostly limited to luxuries and food, and colonies certainly provided a market for the factories, whereas the building of an industrial base was still mostly a regional thing. Case in point: Germans tried to copy both colonialism and industrialisation, with polar opposite different levels of success.

Re: How Laissez-Faire Made Sweden Rich (2013)

#20

Post by mlevental » Sat, Mar 24, 2018, 1:36 PM UTC

oblio wrote: post #3

Personal 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 stan…

I don't understand? Romania and the rest of Eastern was almost all serfs 200 years ago. are you saying because people had clothes (as opposed to I guess indigenous peoples in Africa or something) Romania wasn't poor (and therefore Sweden was actually wealthy?