The Swedish Wage Stucture: The Rise and Fall of Solidarity Wage Policy?

66 Pages Posted: 8 Aug 2007 Last revised: 23 Aug 2010

See all articles by Per-Anders Edin

Per-Anders Edin

Uppsala University - Department of Economics; Centre for Economic Policy Research (CEPR)

Bertil Holmlund

Uppsala University - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Date Written: January 1993

Abstract

Wage inequality in Sweden declined precipitously during the 1960s and the 1970s. There was a sharp reduction in overall wage dispersion and in the relative earnings advantage of highly-educated workers, a marked narrowing of wage differences between men and women, and a trend increase in youth relative wages. There was also a substantial narrowing of wage differentials among workers within broad occupational and educational groups. The trend decline in wage inequality was broken in the 1980s. Wage differentials along several dimensions have widened modestly from the rnid-1980s to the early 1990s. Much of the Swedish discussion has taken it for granted that the pay compression has been driven by the egalitarian ambitions of strong and coordinated trade unions. Our analysis of the Swedish wage structure suggests that institutions are only part of the story. We show that conventional demand and supply factors can go a substantial way towards explaining some key relative wage movements in Sweden.

Suggested Citation

Edin, Per-Anders and Holmlund, Bertil, The Swedish Wage Stucture: The Rise and Fall of Solidarity Wage Policy? (January 1993). NBER Working Paper No. w4257. Available at SSRN: https://ssrn.com/abstract=478705

Per-Anders Edin (Contact Author)

Uppsala University - Department of Economics ( email )

SE-75120 Uppsala
Sweden
+46 18 471 10 97/7 (Phone)
+46 18 471 70 78 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Bertil Holmlund

Uppsala University - Department of Economics ( email )

SE-75120 Uppsala
Sweden
+46 18 471 1122 (Phone)
+46 18 471 1478 (Fax)

HOME PAGE: http://www.nek.uu.se/faculty/holmlund/index.html

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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