Challenges to the Scandinavian welfare model
In: European Journal of Political Economy, Band 20, Heft 3, S. 743-754
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In: European Journal of Political Economy, Band 20, Heft 3, S. 743-754
In: European journal of political economy, Band 20, Heft 3, S. 743-754
ISSN: 1873-5703
Policy debates with increasing frequency question whether the Scandinavian welfare model is robust to the challenges of international integration, demographic change, & changing socioeconomic conditions. The welfare model relies on a large public sector & strives for egalitarian outcomes. Beginning with an interpretation of the Scandinavian welfare model in terms of social insurance, I here consider the major challenges faced & some of the policy options. A particularly interesting question is whether the Scandinavian welfare model is more vulnerable to some challenges than other welfare models. 21 References. [Copyright 2004 Elsevier B.V.]
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Price stability has become the predominant goal for monetary policy. Should the aim be zero inflation or could inflation be too low making it better to strive for a stable (low) positive rate of inflation? This paper analyses why inflation may interact with downward nominal rigidities so as to imply inefficiencies in resource allocation at low rates of inflation. The higher the rate of inflation, the lower the likelihood that downward nominal rigidities are binding (the Tobin argument) and this may cause a non‐linear Phillips curve. Inflation can be too low in the sense that the employment level is reduced and its volatility increased.
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