Yes, “business freedom” relates to the ease of legally opening and closing a business in a country.
Watch this Youtube video from ReasonTV with a Swedish classic liberal PhD. He explains in 9 min what I’ve been saying. That the US cannot go the Swedish way since the Public Sector in the US is so extremely inefficient.
He also discusses the development during the crazy years 1968-1993 and the extreme free market reforms of 1993 onwards that expalisn Sweden’s growth, its not as teh left in teh US wants it to be because of socialism just the opposite, massive lowering of taxes, massive deregulation and privatization.
Lastly he aslo points out the most important thing. Taxes in Sweden are hihg but they are intra personal transfers 80-85 % of taxes paid by and indvudla goes back to himself. The rest 10-15 % covers defense and otehr governemetn functions, redistribution is virtually non existent. In fact Sweden has toghether wiht Germany the wolrds most regressive tax system, low income earners pay higher taxes on low income.
Hi the above sounds like a good system leading to a harmonious society. So I am a little confused.
In the land of the blind the one eyed man is king
What is he talking about? 40% income tax? If you calculate your income tax the way the government wants you to, the income tax for low wage earners is in most municipalities between 30-35 %. And if you include the payroll tax, which you should, low income earners have an income tax of well above 60% already. And of course it doesn’t end there, when you have things like a 25% VAT, but that’s another story.
Sorry to bump this thread, but I was curious if anyone has added anything to wikipedia. I just read the whole thread in the last few days. Great information. Sounds like Sweden is a social democratic-corporatist-welfare state. A mouthful!
which WIki page are you talking about?
This might be another good page for someone to answer (and then we could all vote it up after):
If Socialism is bad, why are the Scandinavian countries rated the best places to live?
A page or so ago, someone suggested compiling and sourcing the information gathered on this thread a making a wikipedia article on it. I was curious is anyone has attempted to do so.
I live in the US and payed 60% of my income to taxes.
In the US we call them Mexicans
Big thanks to krazy_kaju and all who added resources to amazing thread, I’ve processed some into an article here (and I try to avoid using blogs and completely avoid forum posts, but this one is so incredibly useful it deserved a special mention).
I am a Norwegian who has been to both Sweden and Denmark many times.
I have studied at several universities, including LSE and I have been to Mises University
and written a master’s thesis about the Austrian School.
I’d like to repeat what I said in the beginning of this thread: It is wrong, and in fact ridiculous,
to claim that Norway is the least successful of the Nordic countries. What is this based on?
Rather, I’d claim it is probably the most successful nation by most measures.
Yes, Norway has a lot of oil, but it was not until about 1998 that this actually gave the country a surplus. Until that point, Norway was running a net deficit in terms of oil due to the fact that the investments in production of the oil was not yet covered. For the last 12 years, Norway has been fairly careful in their use of the so called “oil money”, only bringing a small part of its return into the economy each year.
Im not gonna deny that there are a lot of problems in Norway. A very large proportion of the population survive on the welfare state and there are inefficiencies. Despite this, I really dont think the living standard is lower in Norway than in any other Nordic country, and its probably higher than in the wast majority of the nations of the world.
In Sweden, the benfits and problems are just about the same as in Norway, but Norwegians have much higher purchasing power than the Swedes do. No young Norwegian goes to Sweden to work, but if you go to Oslo (the capital of Norway), almost every waiter or salesperson in a kiosk or shop is Swedish. They flood Norway to take advantage of the prosperity and better economic oppurtunities that exist in Norway. Also, the Swedes have a major issue with their naïve immigration policy which in Norway is far more sober-minded.
Denmark is surely a nice country, but I don’t really see how they may be regarded as a better country than Norway in economic terms, even though they have much better prerequisities, being essentially an urban central European nation, while Norway is a rural a wild country with a population density almost 1/10 of denmark. Obviously Norway is a more expensive country to run.
Iceland is not really part of Scandinavia (another error in the article. Scandinavia = Norway, Sweden, Denmark. Nordic= Scandinavia + Finland + Iceland), but it can in no way be regarded as more successful than Norway. I think it is enough to remember the financial issues of Iceland 2 years ago, and the fact that Norway bailed Iceland out.
In general, I think the bottom line with this thread is that, whether Austrians like it or not (they do not), a welfare state that is too large is probably no more harmful than a laissez faire economy. In the former, there are inefficiencies and people shirking from work, living off the state benefits. In the latter, you ignore the wast number of situations in which the market does not clear in any relevant sense.
My opinion is that it is too simple to stick to an ideology and to defend it on every issue. What one should aim for is rational politics- if a free market is rational then go for it, but lets not try to justify the free market simply to defend an ideological bias.
Now all you have to do is explain how that works. If the best that you can come up with is, “Oh, producing 0.7 barrels of oil per day per capita is no benefit,” you might want to try a little harder. I suggest starting with a less laughable argument.
Two minor clarifications to get rid of: Britannica defines Scandinavia as you do, adding that some authorities also include Finland, Iceland and the Faroe Islands. (And fairly or not, many people outside of those countries don’t make a distinction either.)
Also, at least the initial post from krazy_kaju doesn’t say that Norway is the least successful of these countries. Don’t know anymore what happened later in this long thread, but let’s not make this a “my favorite country is better than your favorite country”. And if, then with sources please. 
With those asides, I would be also intrigued to hear about the comparative dangers of an oversized welfare state and a laissez faire economy.
Youve written a master thesis but dont know that valuation is subjective?? And that forced market clearance != preference of that situation by market participants, while unforced market nonclearance = preference of that situation by market participants
He didn’t say it was favourable.
Im extremely busy, but I finally found time to write a reply. This post is on Norway, the next one ideology and why I believe social rights may be justified.
Im not very nationalistic and have no interest in making it a “my favorite country is better than your favorite country” kind of thing. However, you are trying to make an encyclopedia article right? So I just wanted to contribute by pointing out that its wrong to state that Norway is the least successful country. I think, like I said, that the extensive immigration to Norway of young Swedes is one proof of that. Why would they all come to Norway if its less successful? And why have Norwegians been able to the majority of holiday homes along the south-western Swedish coast? Besides, Norway with half the population has passed Sweden in TOTAL GDP (at least in one quarter of 2009). That is pretty incredible, and I don’t think oil can explain all of that.
Which country to include in Scandinavia, Nordic etc is of course not a very important matter, especially for those who are not from the area and all different people are good friends so no one would be insulted like the irish might be if you said they were part of the UK. A couple of points though: Scandinavia (Norway, Sweden, Denmark) has been one country in the past. Finland, Iceland and Faroe have been parts of the other three at various times, but always as a subordinate. Also, Scandinavia is tied together by the language- unless the dialect is weird it is relatively easy for people from the three countries to understand one another. Iceland, and especially Finland, on the other hand have languages that are very different and not understandable to a Norwegian, Swede or Dane.
Obviously, the oil discoveries have been great for Norway, but this fact by itself cannot account for the success of the country. Its not enough to find resources, you need to take advantage of them in a good way also.I think the Norwegian government has done so. As history shows, it is not always unambiguously positive for a nation to get a free lunch like that. Galloping domestic costs, a degenerating and increasingly lazy population and generally unwise usage of the newly acquired wealth may easily be the outcome. To some extent it has I guess, but I think it has been a wise policy to invest the money and only to spend parts of the real yearly return for government consumption. Currently, the Norwegian petro fund is the second largest in the world (see list http://en.wikipedia.org/wiki/Sovereign_wealth_fund) and through it, the Norwegian government (ruling on behalf of less than 5m ppl) on average own 1 % of all the companies in the world. That is astonishing and it puts Norway in a very healthy position in facing the aging population etc compared with most other European nations. Hence, most of the oil-money has been invested and has only to a relatively small extent been used to keep the welfare state running.
I think the success of Norway (and the other Nordics) is to a larger extent based on other factors. In terms of economic theory- yes the welfare state is too large and the negative effects may not be seen for generations yet – but one has also largely avoided the incentive problems that was so typical in the Soviet block. This is partly to do with the fact that the Scandinavian countries after all are market economies (by Mises definition, i.e. they all have stock markets), which I guess is one of the aims of the encyclopedia article to point out. Also, I think the policies that have been conducted have been determined and executed in a generally wise way in which specialized professionals have been holding key positions in the national administration and bureaucracy, and in general have aimed to achieve preferable outcomes rather than to be social democrats at all costs. I.e. the market has been allowed to operate freely whenever it did not have consequences that were seen as unacceptable by the electorate and/or the professional bureaucrats.
To the extent that the state still has been oversized and inefficient, I think that most of the Nordic success may be explained from other fortunate factors: These include high levels of human capital, easy access to technology from W.Europe and the US, no serious conflicts among different population groups, no wars to fund or fight (apart from WW2 of course) and abundance of natural resources. Most important, however, has probably been the high level of social capital. People trust each other (or at least they did in the past) because most people share the same values and have the same background. People are few and homogeneous. I think this is an essential point, I think that a welfare state may be a lot more successful in a small and homogeneous country than in a country like the US.
Now to the ideological issues that have been raised. Let me just say that I have learned loads from the libertarian movement which I greatly respect- hence, to some extent I play the devil’s advocate here. However, I no longer think that a laissez-faire should be an ideal to be approached.
Obviously, I don’t need to go into the potential inefficiencies of an excessive welfare state, this is after all mises.org. Regarding the laissez-faire state it is pretty obvious (unless all you read is Ayn Rand and Austrian Economics) that this is not “efficient” in the most relevant sense either . It is basically irrational to leave the state out, claiming that it cannot have any potentially beneficiary role other than as a policeman or as a judge. There are many situations in which the self-interest of individuals by itself does not lead to the desired outcome by most standards, both when it comes to efficiency and moral.
Firstly, there are all the market failures that are identified in economic theory. I recognize that some of these might be taken into account by a laissez-faire constitutional state (at least if you stretch concepts a little), but I think the concept of market failure justified a much larger role for the state than what is implied by the laissez-faire concept. I have heard leading Austrians lecturing to match this problem and I was not impressed.
Second, I think the libertarian movement in general has a too weak and meaningless concept of power. The standard claim is that coercion is wrong. But when is it coercion? Is that only when there is a threat of imprisonment or fines? In a more realistic and broader definition of power, it has to be included that one individual may have power over another in more relative terms as well. The fact that some people (either by skill, luck or heritage) have ownership of resources, usually implies that they have power relative to those who have no resources. I’d say its pretty narrow-minded not to acknowledge that this also may have some relevance and a potentially equalizing role for the state. A high level of inequality, in which a large portion of the population are forced (not in theory, but in practice) to work for wages below what is necessary to maintain a healthy life (by most standards) may be harmful to the extent that these people will suffer and probably develop a hostile view of society.
Third, libertarians acknowledge civil- negative- rights, but refuse to accept any social- positive- rights. Again, I think this is too narrow minded as the latter certainly may affect your ability to claim the former. In principle a person or a company may have the right not to be damaged by anyone else, but in order to claim your civil rights and fight injustice in the court, you need resources and you need at least some basic level of power. Rejecting the social rights as a part of citizenship essentially also deteriorate the civil rights.
Fourth, as economic theory tells us, the marginal utility is declining. Hence, the first dollars you spend on consumption gives the most satisfaction before they the utility of the next one decreases. This justifies redistribution. It is little comfort to people who struggle with health issues and very low income that rich people will invest.
Fifth, there is a society, a community, and- whether you like it or not- we are all living in it, affected and shaped by it. Social capital is extremely important, and it’s the role of the welfare state to safeguard and increase this type of capital.
Do you really think that the working poor, the ill who do not have insurance, the ones with low IQ, etc. are to be left to the whim of charity? I think one of the great advantages of the welfare state is that it creates a sense of security for all the inhabitants, one always knows that one has the most basic social rights no matter what happens in life and I think this improves quality of life and also allows more risk taking.
Darn the lack of time!
I finally found the ‘least successful’ mention, should have been looking better! Thanks for correction, tke, the description has been reworded. Norway has the lowest ranking according to the Index of Economic Freedom, which is certainly not perfect and not an ultimate indicator of success. An encyclopedic entry indeed deserves better. (On the side: if you happen to have respectable resources on the arguments you used, I’d be happy to include them - especially ‘social capital’ and similar hard-to-measure factors, the article is rather heavy on numbers which by far don’t tell the whole story - although the luck to avoid many wars is included, as the strong free-market features these countries have.)
Alas, I don’t have time to refute the second post, hopefully someone else can jump in or point to previous discussions. Suffice to say, the concept of market failure is rather disputed around here, and, even assuming that it exists, one has to compare it to the very real concept of government failure. Will a state improve the evils it sets out to mend, or will it make them them worse? That is a question even a minarchist has to face (hope the label is appropriate).
The other points have more issues and deserve a more detailed address. (Note: the fourth and fifth point are clearly non-sequitur, you might want to look into those.)
I am a Dane who has lived in Danmark and Sweden, and has travelled to norway.
I don’t know what point I made earlier when I entered in this thread, but I think it’s a little silly to argue about how one of the Scandinavian countries is slightly better then another. Because honestly, are the differences that great? To be honest, I get the vibe that your post is tainted with nationalist bias, something incredibly prevalent although tempered in all three scandinavian countries.
Its the same in copenhagen. However, typically, I would argue that Swedes do not go to Norway or Danmark to live there. They go to work there. No young Swede in their right mind goes to “live” permanently in Norway, let alone spend a vast majority of their earnings given how expensive it. When I was in Luleå thats what all the exchange students and Swedes bitched about, was how expensive norway is. The Swedes live in Malmö and work in Copenhagen. Also, a lot of “fun” things for the average jo-blo is highly regulated and taxed in norway. Relative to Danmark or Sweden. Another reason not move.
I want to see some statistics on the claim that Swedes are emigrating to Norway, and residing their permanently.
Also to further explain the difference between Sweden, Norway and Denmark look at their relative positions on the list of countries by GDP (PPP) and the same list per capita. In the first you will find that Sweden is #32, Norway #42, and Danmark #50. This is exactly why Swedes will come work in Norway and Danmark to earn some DKK or NOK to be spent back in Sweden.
More opinion here. Statistics would be nice.
This statement is accurate apart from the Norway bailing out Iceland out thing. Not that Norway didn’t bail them out, but that also Danmark, Sweden, Finland, U.K, and Russia all contributed ^^…and the IMF. Maybe Germany did too? Can’t remember.
And if you want to reason it this way, well how do you explain that Danmark dominated Norway for the greater part of the millennium? And Sweden owned Norway for about 100 years. ^^ (This is the chip in their shoulder that a lot of Norwegians carry.)
I don’t think any Austrian forum will agree to this. Especially not here when they sell T-Shirts that say Markets Clear.
And no I’m not taking that out of context. Although perhaps I’m wrong, maybe someone will post a link to a thread showing just contentious the issue of Markets clearing is in the Austrian Community. ^^