1

The European Union and the Nordic models of

welfare – path dependency or policy

harmonisation? 1

Mikko Kuisma (Oxford Brookes University, UK)

Mikael Nygård (Åbo Akademi University, Finland)

Introduction

The interplay between the European Union (EU) and Nordic welfare states has

received an increasing attention within welfare state scholarship in general and

especially so in the debates on the Europeanisation of social protection (van Vliet

2011). In earlier waves of this literature it has been suggested that processes of so-

called negative integration (Scharpf 1996) have led to some adjustments of member

states’ social protection schemes in accordance to market requirements, but not a

convergence towards a one-size-fits-all EU and so, for instance, the dissolution of the

distinctiveness of the Nordic welfare models is not a real threat (Leibfried and Pierson

2000, Streeck 1995, Majone 1993, Kautto et al. 2001, Kautto 2001). More recently,

however, some have suggested that there are also some signs of positive integration

channelled through ‘soft governance’ mechanisms such as the Open Method of

Coordination (OMC) procedure (van Vliet 2010, Kvist and Saari 2007, Kvist et al.

1 Refereas till som: Kuisma, M. & Nygård, M. (2015). The European Union and the Nordic models of welfare – path dependency or policy harmonisation? Ingår i C. H. Grøn, P. Nedergaard & A. Wivel (red.), The Nordic Countries and the European Union. Still the Other European Community? The Nordic Countries and the European Union. London: Routledge.

2

2012) and the social investment paradigm articulated in, for instance, the Lisbon

Strategy of the EU (Jenson 2010, Morel et al. 2012b).

In this chapter we discuss the interplay between the EU and the Nordic welfare states

with regard to social policy in a general sense. Most notably, we are interested in the

influence that the European Union and the European Social Model (ESM) has had on

the welfare systems in Denmark, Finland, Norway and Sweden over the last decade or

so. Even though some aspects of social policy coordination were visible already in the

Treaty of Rome, it was only in the late 1990s, and especially after the Amsterdam

Treaty of 1999, that social policies started became a central part of the emerging

social dimension of the EU (van Vliet 2011). Yet the approach has still been to let

member states retain most of their national sovereignty with regard to social policy. In

some areas, though, such as health care, pension or anti-exclusion policies, the EU has

nurtured an ambition to achieve higher convergence among member states, most

notably through soft-law governance (Saari and Kvist 2007). This makes it interesting

to ask in what ways the Nordic countries, both the Nordic EU member states as well

as the non-members, have been affected by such attempts of policy harmonisation and

what their responses have been.

Based on the discussion below, we argue that talking about the Nordic model is partly

an exaggeration based on an ideal typical social democratic model á la Esping-

Andersen (1990) and that the Nordic region has always been more diverse in social

policy terms (Kettunen 2010). Furthermore, this has possibly been amplified due to

the varied approach of the Nordics towards the EU. So, instead of the Nordic model,

we argue that we should talk about Nordic models.

3

Secondly, we argue that European integration has not in any way eroded the social

policy regimes in the Nordic countries, although some small steps towards policy

harmonisation have, indeed, been taken, especially when it comes to applying shared

ideas and policy recommendations in the labour market and family policy. Hence, the

relationship between the EU and the Nordic models of welfare can be seen to be

ambiguous rather than based on a one-way causal relationship or transparent dialogue.

The chapter is divided into two main sections. The first consists of a discussion on the

main characteristics of Nordic welfare states in order to set the parameters for the

discussion on changes and challenges to the Nordic model under Europeanisation.

Indeed, we argue that there is no single Nordic model and, as such, we should instead

be talking about Nordic models of welfare. Secondly, we discuss the Nordic policy

developments that emanate from a dual set of reform pressures from the EU from the

mid-1990s onwards. The first concerns the indirect reform pressures that are

associated with the negative logic of integration, pressures to convergence, tax

competition etc. The second are direct, be it possibly more positive, pressures for

welfare reform that coalesce around the European Social Model (ESM), especially as

the Lisbon Strategy has made the ESM again more a priority to the Union.

The Nordic Models of Welfare

The Nordic approach to welfare has often, notably also among observers outside

Scandinavia, been regarded as some kind of an ideal model for how the state, markets

and society are combined into a political-institutional configuration with a capacity to

4

simultaneously produce both economic efficiency and high levels of equality (Einhorn

and Logue 2003). However, these observations have not always been about sheer

admiration or perplexity about how come the ‘bumblebee’ is capable of flying; some

commentators have also taken a critical stance as to the central role that the state plays

in the social welfare of its citizens (Rothstein 1998).

Regime theories of welfare states, the most well-known of these being Esping-

Andersen’s (Esping-Andersen 1990) seminal contribution, gave birth to a set of ideal-

typical models, also the Nordic ideal-typical welfare state, and a set of differences –

both in terms of values and norms, and welfare outcomes – that sets the ideal-typical

models apart from other welfare states (for a useful discussion on competing

typologies of welfare states, see Arts and Gelissen (2002)). In order to evaluate the

degree to which the models have remained distinctive, we need to both pay attention

to those crucial differences and to think about what unites the clusters. In other words,

the intellectual challenge in examining an ideal-typical Nordic model is that it, in the

end, is a generalised version of some of the, arguably very important, aspects of social

policy that are shared between the Nordic countries. So, while they could be treated as

four or five independent cases, they also are closely interrelated (Christiansen and

Åmark 2006, p. 336). As such, it might be more appropriate to talk about Nordic

models rather than the Nordic Model (Kosonen 1998, Kuisma 2007). There never was

one Nordic policy model (Mjøset 1992) – it is an outcome of post-hoc reasoning and

observations of similarities between both the principles and values of welfare and

welfare outcomes in the Nordic countries – rather the Nordicity of these models is

what we are looking at here; hence we talk about the Nordic models of welfare.

5

Despite the rather strong and stable image of the ideal-typical Nordic model, it is not

always clear which countries are included under the heading ‘Nordic’. At times, the

term seems to apply only to the Scandinavian countries. Indeed, in Esping-Andersen’s

(1990) famous typology, the social democratic world of welfare included the three

Scandinavian countries (Denmark, Norway and Sweden), Austria, Belgium and the

Netherlands. Finland was classified in the conservative cluster of welfare states.

Finland caught up on its Nordic neighbours in terms of welfare developments only in

the 1970s (Kettunen 2001), or 1980s – if talking on social policy terms only

(Anttonen and Sipilä 2000). Finland is now often included and Iceland, perhaps the

most understudied of the Nordic cases, is altogether ignored in most such

categorisations.

What, then, are the common characteristics between the Nordic models of welfare? In

the literature, these have been chiselled down to a few central common characteristics

(Kangas and Palme 2005, Kautto 2001, Nygård 2013). First, these countries rely quite

heavily on the public sector for the provision of social welfare, which has led to high

levels of social expenditures and relatively high levels of taxation. Secondly, they are

dependent on high levels of employment and active labour market policies. Third,

they all have an extensive coverage of social rights, with a mixture of income-related,

universal and needs-tested social transfers, as well as a universal provision of public

welfare service provision. This has not only facilitated female emancipation and a

dual-earner model, but it has also led to a relatively high level of equality and low

poverty rates in international comparison. Fourth, institutionally speaking, the Nordic

models can be said to constitute rather centralised, but deeply corporatist

configurations that rest upon a foundation of political consensus, wage coordination

6

and a widespread legitimacy among the public. Fifth, in an economic sense, the

models have relied on highly export-oriented, rather flexible, and competitive

industries where human capital formation through public education and investments

in research and innovation have played a central part (Kangas and Palme 2005, Kautto

2001, Nygård 2013). While talking about one Nordic model of welfare might be

flawed, we could still claim, following Mjøset (1992), that even if it the Nordic model

actually never existed, Nordic models could have a future – but in that future an

important role will be played by the developments at the EU level.

The European Union as a social policy actor

As much as the Nordic model has been used as a reference point in literature, it has

also been seen discussed in terms of the challenges it faces. Because of the central

role of universal services and the comprehensiveness of welfare provision, these

challenges have been considered to be more profound to the Nordic countries than for

other welfare states. The 1970s was a period of low productivity growth in the Nordic

region and especially Denmark suffered from what could certainly be called a welfare

state crisis (Ryner 2007). Some have even argued that the oil crisis and its

consequences in 1973 ended the heyday of the welfare state (Anttonen and Sipilä

2012, p. 26). The debate about the crisis of the Nordic model intensified during the

1990s, largely due to the severe economic recession after the end of the Cold War (see

for example Pontusson 1992, Jenson and Mahon 1993, Rothstein 1993, Andersen

1997, Huber and Stephens 1998, Stephens 1996). The 1990s was, of course, also a

time characterised by an increasingly strong discourse on and around globalisation

and it was during the 1990s that Sweden and Finland followed Denmark into the

7

European Union, as the deepening and widening of European integration was

beginning to gather pace.

The impact that the EU has had on the Nordic models of welfare is not an entirely

straightforward question to answer, since some have argued that some of the changes

that have taken place in these countries since the 1990s have been related more to the

process of increased globalisation rather than the role of the EU social agenda (for a

discussion see van Kersbergen 2000, p. 20). Indeed, some have argued that it is not

the processes of globalisation but the increasing dominance of discourses and ideas

linked to neoliberalism expressed in phenomena such as Third Way social democracy

that have had a serious impact (for instance Ryner 2002). As such, globalisation is

potentially having an impact, not as a process, but tendency that also has counter-

tendencies (Hay and Marsh 2000, p. 6). Yet it seems plausible that both of these could

have played a role and in an interconnected way. Namely, the EU has had an impact

on these countries, not only because it has started to play an enhanced role as a social

policy actor, but also since many of the policy agendas developed since the mid-1990s

have been essentially about common strategies in adapting to an increasingly

globalised world.

If we look closer at the relationship between the EU and the Nordic welfare models,

and start by identifying central policies within the EU that may have functioned as

drivers of social policy reforms in these countries, we can use the distinction made by

Saari and Kvist (2007, pp. 1-4) as a starting point. The authors identify four central

developments within the EU that, so they argue, have fuelled the process of a

Europeanisation of social protection. These include: a) new policy processes and

8

themes within the EU social dimension, b) an increased application of internal market

rules to the area of social protection, c) the EMU, and d) the EU enlargement process.

The first development has brought along an emphasis of social policy as a production

factor and has put goals of employment promotion, social inclusion as well as poverty

reduction on the EU agenda through the Treaties of Amsterdam and the Lisbon

Strategy. The second development has made principles of gender equality, anti-

discrimination objectives and the coordination of migrant workers’ social rights on the

agenda, notably for the European Court of Justice. Moreover, internal market and

competition law has been gradually endorsed within member states social protection

schemes and practices. The third development, the role of the EMU as well as the

Stability and growth Pact, has introduced stricter budgetary discipline, a ban against

deficit funding of welfare states, and has introduced the concept of ‘structural

reforms’ as a way of achieving higher labour market flexibility and economic

efficiency. Finally, the EU enlargement process has brought with it an emphasis of

mainstreaming social protection standards within the Union. This has meant an

overall discussion of minimum social rights and has brought with it directives for

bringing welfare state ‘latecomers’, such as Southern-European and Eastern-European

countries, closer to the social provision levels of the Northern and Continental

countries. One good example here is the much debated Commission directive of

maternity leave from 2010 (Lane et al. 2011).

The EU and Nordic models of welfare

9

What impact have these kinds of policy developments within the European Union had

on the Nordic models of welfare? One way in which we can assess these impacts is

through making a distinction between impacts arising from common social policy

objectives manifested through the ESM and those emanating from EU-driven

strategies aiming at cushioning the effects economic globalisation, social

transformation and growing financial instability (Ferrera 2005, Guillén and Palier

2004).

The first type of impact is related to the ambition of the EU and the European Council

to bring forth social policies as a production factor enhancing economic growth and

social inclusion across EU member states (Ferrera 2005). Although the idea of

‘productive social policy’ was inherent already in some earlier treaties such as the

Amsterdam treaty in 1997, it was not until the Lisbon process and the Social policy

agenda 2000-2005 that these objective started to play a visible role for the EU ‘social

dimension’ (European Commission 2000). In this agenda, investments in human

capital as well as more enabling and preventive social protections systems capable of

facilitating social inclusion – notably for countries with the lowest social welfare

provision levels – were seen as important for the social cohesion and economic

prosperity.

As an example, the Barcelona summit in 2002 accentuated the need to expand

childcare provision within EU countries as a means to increase parental employment,

but also as a means of preventing child poverty and enhancing social exclusion (cf.

Plantenga et al. 2008). Consequently, there have been investments in childcare and

family policies that have been legitimised as investments in gender equality,

10

employment promotion or investments in children’s human capital and life-long

opportunities (Meagher and Szebehely 2012). Although the childcare up-take rate is

very different between Norway, Sweden and Denmark on the one hand and Finland

on the other (see table 1), and investments in childcare and family leaves have been

framed very differently (Hiilamo and Kangas 2009), it is plausible that the EU social

investment creed has played an important role for framing such policy changes (Morel

et al. 2012b).

<TABLE 1 HERE>

To some extent the accentuation on childcare and early education can also be seen as

evidence of a shift toward a child-oriented investment strategy (cf. (Esping-Andersen

2002), something that is also often referred to as the social investment paradigm

(Morel et al. 2012a). According to this strategy, investments in children are not only

efficient since they prevent social problems that otherwise might occur, but also since

they generate human capital among children – a commodity widely cherished in the

Europe 2020 strategy aiming for a smarter and competitive knowledge society (Morel

et al. 2012a).

Other examples of impacts of the EU is the EU Council directives on equal treatment

(2000/43/EC) and discrimination (2000/78/EC), that required member states to update

their legislation by 2006 at the latest (Sargeant 2008). As an example, while Finland

revised its legislation on anti-discrimination already in 2004, this happened only four

years later in Sweden. In both cases though, the parliamentary proceedings relating to

these legislative amendments suggest a quite clear causality between EU directives

11

and national legislation (Nygård and Snellman 2014, forthcoming). Another example

of the impact that EU directives can have on Nordic welfare states is the adoption of

common practices and rules when it comes to creating competition within the

production and public goods and services (European Council 2004/17/EG; European

Council 2004/18/EG). The adoption of these directives has had an immense impact on

the creation of internal markets and public-private-partnerships within the social and

health care sectors in most Nordic countries, though more so in Sweden and Denmark

than Finland and Norway (cf. Meagher and Szebehely 2012).

More recent examples of this kind of impact relates to gender equality goals and the

aim to increase fathers’ uptake of parental leave. The gender equality dimension refers

to a balanced use of parental leave between spouses after childbirth. Although the

Nordic countries, especially Denmark and Sweden are known for high take-up rates of

parental leave compared to other European countries, some policy changes such as the

recent extension of paternity leave in Finland suggest that an extension of the gender

equality dimension is still relevant in Nordic welfare states. Alongside national factors

that explain these recent investments in gender equality vis-à-vis parental leave, the

EU directive on parental leave from 2010 (Directive 2010/18/EU) may also have

played a role here. The directive, which gave each working parent the right to at least

four months leave after the birth or adoption of a child, can be seen as an instrument

for promoting gender equality, since it includes a conditional month that cannot be

transferred to the other parent and that will be lost if not taken. This is intended to

give fathers a stronger incentive for taking parental leave.

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But the ambition to increase employment levels and boost growth within the EU area

is also likely to have had an impact on labour markets and pension policies. These

impacts are likely to have been reinforced by the financial crisis insofar as it has

brought with it a wave of activating labour market policies, investments in work-

family reconciliation measures as well as measures for making unemployment benefit

schemes more reciprocal. According to a report published by the European Trade

Union Institute (Clauwaert and Schömann 2012), there is a general trend towards

wider changes in European labour market relations and legislation that threaten to

deteriorate workers’ rights and work conditions. According to the report, this trend is

also valid for the Nordic countries, except perhaps for Norway.

When it comes to pension policy, this area has been brought to the fore as a

consequence of rapidly ageing populations (Kautto and Kvist 2002, pp. 192-3). As a

part of the EU employment agenda, but also as a part of the overall accentuation of

active ageing within EU member states (Walker 2002), many European states, and

especially the Nordic countries, have pursued pension reforms that seek to raise the

average pension age and enforce the financial sustainability of mandatory pension

schemes. In 2005 Finland conducted a major reform, and in 2017 another overhaul of

the Finnish pension system is announced as a way of addressing the long-term

sustainability of public and private pension schemes (Natali and Stamati 2013).

The second type of impact is more indirect in nature and has more to do with common

policy reactions and the different mechanisms of EU decision-making. Not only have

most EU member states faced similar challenges in terms of economic and social

transformation, such as sluggish growth, increasing financial instability, greater

13

diversity in household structures and ageing populations; they have also used policy

instruments that are both coordinated through mechanisms such as the OMC

procedure and influenced by similar dominant ideas, discourses and policy

recommendations on why, and how, such challenges should be handled (Mehta 2010,

Hay and Rosamond 2002).

One visible impact of such ambitions is an overall pattern of stricter budgetary

discipline and an adherence to public cost containment, which has its origins in the

Maastricht Treaty as well as the Stability and Growth Pact. For the Nordic countries

this has meant a closer scrutiny of public welfare expenditures, as these expenditures

constitute the bulk of the overall public spending. For some countries, notably Iceland

during the heyday of financial crisis and Finland since 2010, the financial crisis and

its sibling, the Euro-crisis, have indeed aggravated the situation, and made pension

reforms even more warranted. Currently, also Finland is undergoing a major structural

reform process that has its roots in the reform creed institutionalised through the

Stability and Growth Pact but that is also a consequence of low growth rates and

rising public debt rates. Interestingly, this tells a story about mounting financial

pressures caused by the financial crisis, but it also reveals a strong adherence to the

EU creed of austerity and budgetary discipline as the main rationale in the midst of

economic crisis. In a way, this may point at something close to a paradigmatic change

in the way that the state’s role for social welfare is conveyed. It is also likely to divert

the evolution of Finnish family policy away from the more traditional Nordic path

with universal services and universal child benefits for all. It is also plausible, that

these hardening economic circumstances may also trigger ideological criticisms of the

14

Finnish family policy, criticisms that have so far been quite subtle and downplayed in

the political discourse.

With these changes in social policies, it would not be surprising to see increasing

Nordic variation, as the direct impact will only be relevant to three out of the four

main Nordic cases and the indirect impact of the EMU will have a most pronounced

effect only in one out of four. As only three of the four Nordic countries under

investigation here are members of the EU, this can obviously have an important role

on the varied impact EU has had and will have on Nordic social policy. Furthermore,

among the three EU member countries, the different approaches to monetary

integration create very different policy repertoires for each country. While Denmark

and Sweden have kept their national currencies and saved the possibility of devaluing

their currencies in situations of sluggish growth and declining competitiveness,

Finland as a Euro country has no other option than to use ‘internal’ devaluation in

similar situations through the use so-called structural reforms. The ongoing

restructuring of the Finnish welfare state, with cutbacks in welfare transfers and

envisaged tax increases, can be seen as a good example of this kind of reform, since it

has become widely viewed as an economic and political necessity after several years

of sluggish growth, a greying of the population and rising public debt (Nygård et al.

2013).

The Nordic models in the 2000s – from diverging welfare expenditure to varied

outcomes?

15

So far we have discussed possible impacts of the EU and the ESM on different aspects

of Nordic social policy. Let us now turn our attention to the outcomes that recent

social policy changes may have had on public social expenditures and the level of

social wellbeing in Nordic countries. As shown in figure 1, which shows the change

in the level of public social expenditure relative to GDP from 1980 until 2012, we can

see some fluctuation during the 2000s, but also some interesting country variation.

<FIGURE 1 HERE>

We see a successive increase of public social expenditures until 2009, followed by a

slump in the years 2010 and 2011 that is most likely caused by the financial crisis. In

Denmark, Finland, Sweden, the relative public social expenditure level started to rise

again in 2012. We can also see that there are major differences between the countries

in terms of public social expenditure levels, with the abovementioned three countries

in top and Norway on much lower level. It should be noted though that one

explanation to this difference lies in the GDP rate, which has generally been higher in

Norway than in the other four countries. When it comes to the change in standard of

living (Figure 2), measured as GDP per capita, we see a similar slump in 2009 as in

the case of expenditures. We can also observe that Norway is in a class of its own,

whereas the four other countries tend to cluster nearer to the OECD average.

<FIGURE 2 HERE>

What about the effects on equality? As shown in table 2, we can detect an overall

increase in the income inequality level as the Gini coefficient has climbed in all five

16

Nordic countries since the mid-1990s, save for Norway where it climbed in the early-

2000s and then dropped. A possible explanation to this change is the higher and

persistent unemployment that has troubled these countries in the wake of the financial

crisis, but another explanation lies in the number of high-wage earners, notably those

with capital incomes. Moreover these changes reflect a somewhat weaker

redistributive capacity of taxation systems in the Nordic countries as well as cuts in

unemployment benefit generosity as well as other social transfers (Immervoll and

Richardson 2011).

<TABLE 2 HERE>

Table 3 tells a rather similar story as we can see that relative poverty levels have

climbed in all Nordic countries during the 2000s, more so though in Finland, Norway

and Sweden than in Denmark and Iceland.

<TABLE 3 HERE>

It is hard to say whether these changes in social wellbeing reflect processes of

Europeanisation or are an outcome of other processes. The most probable

interpretation would be that they reflect changes in income structures as well as a

weaker distributive effect of taxation systems and income transfers in the first place,

whereas processes related to Europeanisation is only reflected in an indirect way.

Conclusion

17

The aim of this chapter has been to discuss the influences of the EU social dimension

on Nordic welfare states over the last decade. A first conclusion that can be drawn

from this discussion is conceptual and relates to the Nordic welfare model. We argue

that talking about the Nordic welfare model is a simplification that has its roots in the

heyday of the ‘welfare modelling business’ (Abrahamson 1999). Not only have the

Nordic countries been more diverse both socially, culturally and politically than these

typologies have let us understand, they have also largely created a picture of the social

policy systems that often misses the finer nuances of diversity between the models.

Furthermore, and importantly for the core questions asked in this book, the Nordic

countries have adopted somewhat varied approaches towards the European integration

process and the EU, with Denmark and Finland being more actively involved than

Sweden and certainly Norway.

Second, we can trace a growing influence from the EU in terms of a higher

accentuation of soft-law governance and policy learning (Saari and Kvist 2007) as

well as the use of best practices that have given politicians in Nordic countries a wider

repertoire of policy responses to similar challenges like economic openness, ageing

populations or labour-market inefficiencies (Schmitt and Starke 2011). As an

example, ideas about the social investment welfare state have received a growing

attention among Nordic policy makers, most notably within early childhood and care

policies (Campbell-Barr and Nygård 2014). Likewise ideas about social inclusion and

employment promotion, as presented in the Amsterdam Treaty, The Growth and

Stability Pact and the Lisbon Strategy have had a strong influence on active labour

market policies, the accentuation of work-family reconciliation and reforms of

18

unemployment benefit systems in all Nordic countries, but perhaps most visibly so in

Denmark and Finland.

This is not to say that there would be financial or political challenges that threaten to

undermine the core foundations of the Nordic welfare models. One important

challenge is the significant funding base that is needed for financing the Nordic

welfare systems and the fact that most countries, most currently Finland, experience

problems of maintaining this base due to sluggish growth and rising unemployment.

Nordic states may experience increasing political criticism towards the universal and

tax-funded Nordic welfare system as the middle classes are becoming more

individualistic and require more say in the provision of, for example, health care

services and elderly care services. Also the EU has a role to play here. Through the

different treaties and regulations that constitutes the EU social dimension, but also

through the mechanisms related to the monetary cooperation, much of the political

and economic room for manoeuvre for national governments have spilled over to the

European council, the Commission and the European Central Bank. For the only

Eurozone member among the Nordic countries, Finland, this has meant that the

government faces the same challenges as other countries, but has a diminished

capacity to conduct independent economic and fiscal policy.

All in all, this means that the changes that have been made in Nordic countries during

the 2000s, and those that are currently envisaged, are not so much related to the

European Union per se as to wider economic factors linked to the developments and

changing discourses in the global market. It also means that we can observe quite

different policy responses to the challenges facing the Nordic welfare states. For

19

instance, whereas Norway has not pursued most cost containment and cutbacks in

social policy, the other countries have to varying extent been forced to pursue such

policies. The focus and scope of such curtailments differ, however, as a result of

domestic factors and institutional and political characteristic of the countries.

20

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Tables and figures

Table 1. The share of children that receive more than

30 hours of childcare or early education per week

(EU-SILC). Source: Eurostat 2012

Children under

3 years

Children

between 3 and 7

2005 2010 2005 2010

Denmark 60 68 79 75

Finland 19 20 51 56

Iceland 33 37 73 92

Norway 22 37 52 65

Sweden 31 33 52 65

Table 2. The development of the Gini coefficient in Nordic countries from the

mid-1990s to around 2010 (disposable incomes). Source: OECD 2012

ca 1995 ca 2000 ca 2005 ca 2010

Denmark 0.22 0.23 0.23 0.25

Finland 0.22 0.25 0.25 0.26

Iceland .. .. 0.26 0.30

Norway 0.24 0.26 0.28 0.25

Sweden 0.21 0.24 0.23 0.26

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Figure 1. Public social expenditures in relation to GDP (%) in Nordic countries 1980–

2012. Source: OECD 2014

Figure 2. The standard of living in the Nordic countries 2001–2011. Gross domestic

product per capita, US $, current prices, current PPPs. Source: OECD 2014

Table 3. The relative income poverty in Nordic countries since the mid-1970s to around 2010.

Source: OECD 2012

ca 1975 ca 1985 ca 1990 ca 1995 ca 2000 ca 2005 ca 2010

Denmark .. 6.0 6.2 4.7 5.1 5.3 6.1

Finland 9.9 5.2 .. 4.1 5.3 6.6 8.0

Iceland .. .. .. .. .. 5.9 6.4

Norway .. 6.4 .. 7.1 6.3 6.8 7.8

Sweden 3.8 3.3 3.6 3.7 5.3 5.3 8.4 Note: the threshold for poverty is set at 50 percent of the median wage in each country and year.