Nordic Democracy – Fact or Fancy

An article written by the Finnish President, Tarja Halonen, a well respected figure on the European science. As a citizen, democracy has begun to be my worries, not only after the US specific measures against the terrorism, bu also after seeing what happens in Italy and in France in the last years. We have to learn from the North.

An Australian view on the Nordic Social Models

The Australian Review of Public Affairshas published in 2006 a very interesting article “Social democracy in northern Europe: Its relevance for Australia” written by Andrew Scott for The University of Melbourne and RMIT University. Dr Andrew Scott is an honorary Fellow of the Contemporary Europe Research Centre at The University of Melbourne, and is on leave from his position as a Senior Lecturer in the School of Global Studies, Social Science and Planning at RMIT University. He is author of Running on Empty: ‘Modernising’ the British and Australian Labour Parties (Pluto Press), and many other publications about labour and social democratic parties. And his article proves that the Nordic models are also studied outside Europe.

ABSTRACT
Social democrats in English-speaking countries have frequently looked to Sweden
and its neighbours as offering a policy model that combines economic prosperity
with social equality.

The Finnish National Innovation System

Finland is, with Sweden, one of the most innovative country in the world, and it is useful to have a look at why. I have thought that this European report prepared by ERRIN (European Regions Research and Innovation Network) would be useful for those who lack a proper introduction to the Finnish innovation system, and could inspire us.

Executive Summary

The industrial countries of today are experiencing processes that are shaping their societies and industries towards a knowledge-based economy. In this development the flow of goods in most economic fields will soon be replaced by the flow of knowledge and information. Together with increasingly intensive international competition, individual countries and regions are hard-pressed to improve their capabilities to rapidly generate and diffuse knowledge.

End of Equality? The Welfare State Model Beyond the Crisis

The last delivery of Framtider, the magazine of the Swedish Institute for Future Studies, is extremely interesting as, beyond the usual critics and opponents to the Swedish model, it is a well documented analysis on the real situation in Sweden. Joakim Palme, Director of the Institute for Futures Studies, Johan Fritzell is Professor of sociology and director of research at the Institute, and Åke Bergmark, Professor of social work and research director at the Institute have an interesting approach about the real Swedish situation. And of its dangers.

What shape is the Swedish welfare state model in following the austerity measures of the 1990s? Since the model is so intrinsically connected to the concept of equality, any assessment of changes in the model should also consider how equality in people’s living conditions has been affected. From an analytical perspective, the Swedish tradition of welfare research further implies that we should make a distinction between the welfare state institutions as such and the resources that make it possible for individuals to control their own lives, i.e. what ultimately determines their welfare. How, then, is inequality changing in the beginning of the 21st century after a decade of economic growth above the European average?

From welfare states to partnering societies – the new framework for changing welfare

There are different views on welfare in our world. It does not exist or is very limited for a large majority of our fellows human beings in the world, It is restricted voluntarily to a living minimum (some would say less) in the US and some European countries, and it is extremely developped in some central european countries, such as France and Germany, and in the Nordic European countries. This working paper, written in 2006 by Elina Palola, Taina Rintala and Annikki Savio, insists on the necessity of renovating welfare policies by introducing the notion of partnership, and thus developing democracy … and efficience. It is part of a global concept that I personally call the next step of (social) democracy, after the failure of the british third way.

Conclusion

The concept of partnership as a means of social description suggests a crumbling of old social structures, a constant flow of messages and a resultant reconstruction of social reality (Allardt 1998, 93). A sign of the change of social structures and practices is that we have increasingly moved from representative democracy to deliberative democracy: With the emergence of various partnership networks, there is no longer any need to make traditional distinctions, divisions and categorisations – for instance, between the public and the private or the economy and the social – but different processes and dimensions intertwine to an ever greater degree; at the same time the arenas of impartial communication disappear.

Minimum wages and youth employment: decreasing the wages had no effect on youth employment

This article, “Minimum wages and youth employment: Evidence the Finnish retail trade sector” is proving that in Finland, in the 90s, letting employers the possibility to pay less young people had practically no effect. It has been written by Petri Böckerman for the Labour Institute for Economic Research, and Roope Uusitalo for the Labour Institute for Economic Research and the Institute for Labour Market Policy Evaluation.

Abstract

Following an agreement between the trade unions and the employer organisations,
Finnish employers could pay less than the existing minimum wage for young workers
between 1993 and 1995. We examine the effects of these minimum wage exceptions
by comparing the changes in wages and employment of the groups whose minimum
wages were reduced with simultaneous changes among slightly older workers for
whom the minimum wage regulation was still binding. Our analysis is based on the
payroll record data and minimum wage agreements from the retail trade sector over
the period 1990-2005. We discover that average wages in the eligible group declined
only modestly despite the fact that the excess supply of labour during high
unemployment should make it relatively easy to attract workers even with low wages.
The minimum wage exceptions had no positive effects on employment.

Does outward foreign direct investment reduce domestic investment? Macro-evidence from Finland

Interesting article from Pekka Sauramo, who shows that direct investment in foreign countries prevent investors from investing in their country, which can be a real problem, except perhaps for big countries. It is part of a research project which has been financed by the Finnish Academy and the Finnish Work Environment Fund. Pekka Sauramo works for the Labour Institute for Economic Research, in Helsinki, Finland.

ABSTRACT
The paper is concerned with the relationship between outward foreign direct investment (FDI) and
domestic investment in Finland during the post-depression years of low domestic investment
activity. The relationship is analysed by the use of macroeconomic data on the period from 1965 till
2006 and through the estimation of dynamic investment equations which are based on the macroeconomic
framework employed by Feldstein (1994).

Female Leadership and Firm Profitability: firms lead by women more profitable

This report, witten by Annu Kotiranta, Anne Kovalainen, Petri Rouvinen has been published by the Finnish Business and Policy Forum. This should inspire our shreholders when they chose a CEO…

Summary

Less than a tenth of the CEOs of Finnish firms and less than a fourth of the corporate board members are women. From a social standpoint more women are desired in top management, but should firms’ owners and those represent¬ing their business interests be concerned with women’s role in top management? Since hard facts have been in short supply, we seek to an¬swer the question by applying scientific research methods.

Our results indicate that a company led by a female CEO is on average slightly more than a percentage point – in practice about ten per cent – more profitable than a corresponding company led by a male CEO. This observation holds even after taking into account size differences and a number other factors possibly affecting profit¬ability. The share of female board members also has a similar positive impact. These findings are significant and important not only from a statistical and research perspective but also from a business standpoint.

Small is Resilient–the Impact of Globalization on Denmark

Small is beautiful, small is resilient: it is really interesting to see that a small country is sometimes better at facing globalization than bigger ones. The example of Denmark, in this article from , KlausNielsen and Stefan Kesting publish in 2003 in the review of Social Economy, is teaching a lesson for our governments.

Abstract
The aim of this article is to investigate the impact of globalization on the Danish economy. We focus on four possible influences of globalization and European integration (as one of the expressions of globalization) which are widely discussed in the scientific discourse on this topic and appear to be relevant for the Danish case. These dimensions are the reduction of the repertoire and effectiveness of national economic policy, the pressure for industrial restructuring, the seemingly required welfare retrenchment and the ideological implications of globalization as a predominant neo-liberal discourse. On the one hand we discuss Denmark as a typical example of a small European state and a Scandinavian welfare state regime, on the other hand we put emphasis on its nation peculiarities. The article shows that Denmark changed and adapted successfully to challenges of globalization while keeping the core of its particular form of the Scandinavian welfare model.

In addition, both its smallness and its distinctive national characteristics equipped Denmark well to turn the impact of globalization into a successful strategy for survival. However, there are indications that the translation of neo-liberal ideas in the Danish negotiated economy will lead to political disruption that challenges fundamental features of the model. Whether this may undermine the dam that had hitherto held back the globalization pressures in the Danish context and secured a response in accordance with the inherited characteristics of the Danish model remains an open question.

Introduction
There is an extensive literature on the impact of globalization on the autonomy of nation states, social democracy and the welfare state. Much of this literature seems to agree on the fact that globalization has reduced the importance of national boundaries for economic transactions and has asserted structural pressures for change. However, there are diverging views about the overall effects of these changes. Some argue that the forces of global competition lead to reduced state spending and state intervention, more “market-friendly” policies, and the demise of social democracy and the modern welfare state (e.g., Garrett and Lange 1991, Gill 1995, Cox 1997). Others argue that the social and political impacts of globalization vary significantly dependent on the mediating role of the institutions of nation states (e.g. Hirst and Thompson 1999, Weiss 2002, Kjaer and Pedersen 2001). A growing literature, drawing primarily from an institutionalist perspective, stresses the growing empirical evidence of a wide variety of nation specific trajectories of national welfare and industrial-relations institutions and their path-dependence (Esping-Andersen 1996, Berger and Dore 1996, Crouch and Streeck 1997).

The predominant view seems to hold that economic globalization exposes all nations to policy constraints with the strongest pressures coming to bear on small nations who are more economically vulnerable. Yet this view is not uniformly held. Based on her review of three areas of economic policy and intervention–taxation, fiscal spending and industrial policy–Weiss (2002) concludes that the state has much more room for maneuvering than what she calls the “constraints school” seems to assume. She argues that globalization has even “enabling” effects, and that small states are not necessarily more “constrained” and less “enabled” by globalization than larger states. Size matters less. What matters more is the character of national domestic institutions.

Denmark is an interesting case in this respect. As part of the Scandinavian vanguard model of social democracy with its high-tax, high-spending regime, strong labor market policies, high income equality and equal wealth distribution, Denmark would seem a prime candidate for declining autonomy in the era of globalization. Furthermore, the Danish industrial structure has often been characterized as lagging, vulnerable and pre-Fordist, especially in comparison to its Scandinavian neighbors (Mjoset 1987). In recent years. however, Denmark has been viewed by some as a model for maintaining high aspirations of welfare and social democracy despite the challenges of globalization (Nielsen 2001).

The full article on the web

The European Social Model (ESM) and cultural diversity in Europe

This analysis, from Jean-Claude Barbier, is a working paper from the Department of Economic, Politics and Public Administration of Aalborg University, already well-known for our readers. The idea of referring to cultural diversity in order to analyse the European Social model is an interesting one, and, even if it not stricto sensu a Nordic work, I feel that it is interesting for all our readers.

Introduction

In the past forty years a voluminous body of literature has been published to analyse the phenomena of European integration, Europeanization, convergence and diversity of all kinds of institutions and social practices across states that are members of the European Union. A long journey was made from the first studies, like for instance Ernst Haas’s who, in 1968, revisited his 1958 theory of ‘spill-over’, after General de Gaulle, to him, had changed the conditions of European integration, because he was “a true nineteenth nationalist” (1968: xviii). Spill-over, Haas thought in 1958, in the first edition of his book, was inevitable: it was, he wrote, “unlikely that the General Common Market can avoid a species of political federalism in or-der to function as an economic organ” (1968: 317). Why “political federalism” has still to really emerge in the present conditions remains to be explained and we will deal with only one small angle to this question, namely, the special case of the ‘social dimension’ of European integration.

We will contend here that, despite the immense change brought to Europe by the 50 years of initiatives started by the 1957 Treaty of Rome, despite the crucial aspect of ‘negative integration’ (Scharpf 2000) and the increasing homogenisation of elites through their cross-national socialisation, ‘political cultures’ still matter to such an important degree that they preclude, and probably will preclude for a long time, the very possibility of actually implementing the basic process and practices that ‘solidarity’ demands, under the now classical institutionalised forms of ‘social protection’ (Barbier and Théret 2004).