Scandinavian Unexceptionalism - A drop in wealth

Home to IKEA, the Swedish Chef, Swedish meatballs…and the most comprehensive cradle to grave welfare system in the western world. [...] (IKEA, for example, began in 1943.) Also in Sweden, net job creation between 1950 and 2000 was close to zero in spite of the increase in population.5 Then there are the high rates of hidden unemployment. [...] This happens when the government classifies individuals on various government programs as “employed.”6 The Swedish government reported unemployment rates of about five per cent in 2004, but a McKinsey report in 2006 showed in reality unemployment was somewhere closer to 17 percent.7 Some of the most interesting sections of the book explore why Scandinavians accept such high taxation. [...] In Finland, between 1965 and 2013, hidden taxes like the Value Added Tax (“VAT”) and mandatory social security contributions rose from eight percent of GDP to 22 percent.8 In Denmark, indirect taxation rose from four to 10 percent; in Norway from four to 18 percent and in Sweden, indirect taxes rose from four to 19 percent.9 A drain on motivation Consider the true story of a Swedish dentist who pr. [...] According to the World Values Survey, in Sweden, there has been a substantial increase in the percentage of people who believe abusing government benefits isn’t always wrong.10 Shockingly, “Sweden exhibits the highest level of wealth inequality… The reason for this uniquely uneven wealth distribution is that many Swedish households depend on government safety nets and thus have limited savings.”11.