Sweden s Road to Modernity: An Economic History

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1 Ekonomisk historia engelsk_layout Sida 3 Sweden s Road to Modernity: An Economic History Translation Ken Schubert sns förlag

2 Ekonomisk historia engelsk_layout Sida 4 SNS Förlag Box Stockholm Telefon: Telefax: SNS Studieförbundet Näringsliv och Samhälle är ett fristående nätverk av opinionsbildare och beslutsfattare i privat och offentlig sektor. SNS vill genom forskning, bokutgivning och möten bidra till debatt och rationella beslut i samhällsfrågor. The book was awarded the Pro Lingua Prize in 2007 inaugurated by the Bank of Sweden Tercentenary Foundation and The Swedish Foundation for International Cooperation in Research and Higher Education to enable the translation into English. Sweden s Road to Modernity: An Economic History First edition First printing 2010 The authour and SNS Förlag The original title: En modern svensk ekonomisk historia. Tillväxt och omvandling under två sekel (2000, 2007) Translation: Ken Schubert Front cover: Lena Eklund Graphic design: Sture Balgård Print: TMG Sthlm, Stockholm 2010 isbn

3 Ekonomisk historia engelsk_layout Sida 5 Content Preface 9 chapter 1 Growth and transformation during two centuries 11 Growth and transformation 13 Pillars of growth 15 The question of transformation 18 Complementarity and development blocks 21 A pattern in long-term social development 22 A structural cycle 29 Foreign trade and Swedish transformation 32 How this book is organised 34 Background in previous research 36 chapter 2 The Transformation of Agriculture and Early Industrialisation, the european background 37 The foundation of the Industrial Revolution is laid 37 The decades of revolution 40 the transformation of agriculture and early industry in sweden until the mid-19th century 43 Population growth 46 New economic growth 49 The transformation of agriculture 52 Market growth and industrialisation in the agrarian society 66 Growth of the markets and institutional change 94 Epilogue in the first wave of transformation 102 chapter 3 Railway Construction and Expanded Industrialisation, spread of industrialisation and transformation in europe 104 Development block surrounding the railways 105 International integration 107 Political transformation 111 The Long Depression and rationalisation 114

4 Ekonomisk historia engelsk_layout Sida 6 sweden and the breakthrough of industrialisation, A breakthrough for modern growth 117 Why didn t Sweden become an underdeveloped country? 125 Institutions and the liberal breakthrough 128 Industrial transformation 142 A new working class s culmination and crisis 159 Rationalisation and new conditions in the 1880s 163 chapter 4 The Breakthrough of Industrial Society, the second industrial revolution 178 Development blocks surrounding engines 178 The greater importance of human capital and the degradation of labour 182 Industrial transformation 183 Uneven development 185 the breakthrough of industrial society in sweden in the 1890s and afterwards 187 Swedish growth accelerates after Structural change, Forces of growth 206 The capital market, venture capital and industrial transformation 219 New institutions 227 The situation before World War war profits, crisis and rationalisation, World War 1 and expansion in the 1910s 233 The crisis of the 1920s and the breakthrough of industrial society 246 Rationalisation and new forces of growth in the 1920s 262 Women s labour market and middle-class femininity 277 The situation around chapter 5 The Peak of Industrial Society, from crisis and war to all-time records 281 Development blocks and a new economic policy 282 the swedish economy in transformation, In the front ranks of international growth 287 Growth, productivity and employment, The crisis of the 1930s 293 The Social Democrats and new economy policy 296 Why did Sweden cope with the crisis of the 1930s so well? 299 The Swedish economy during the World War The post-war programme 312

5 Ekonomisk historia engelsk_layout Sida 7 a golden age of growth in the western world, Institutional solutions 315 The technology gap 318 Supply of factors of production 320 a golden age of industrialism in sweden, Growth, productivity and employment, The expansion of foreign trade and a new generation of exports 326 Investment and development blocks 329 A Swedish model for the welfare state 344 Large companies and groups of shareholders in industry 355 Industrial growth culminates 360 The rationalisation of agriculture and forestry 367 The outlook in chapter 6 The Third Industrial Revolution and the Breakthrough of the Service Economy, transformation and globalisation 373 Structural crisis, stagflation and the new economic policy regime 374 The electronic revolution 381 From industrial society to service economy? 391 the swedish economy in crisis and transformation since the 1970s 402 No longer in the lead 403 Two perspectives on Sweden s relative decline until the 1990s 404 The main components of structural transformation 408 The structural crisis during the 1970s 417 Transformation in the 1980s and 1990s 426 epilogue Perspectives from the Third Industrial Revolution 446 References 453 Index of persons 473 General index 475

6 Ekonomisk historia engelsk_layout Sida 9 Preface to the First Edition This study of growth and transformation in the 19th and 20th centuries traces Sweden s road to modernity while offering a new, indepth analysis of economic trends. The rapid economic and social change of recent years makes the perspective of economic history more relevant than ever. The book stems from many years of instruction and research on growth and structural change at the Lund University Department of Economic History. Grants from research foundations have been vital to such a long-term effort. Riksbankens Jubileumsfond has been a major source of financial support for International Integration of Sweden in the 19th and 20th Centuries, European Perspectives on Economic Growth Since 1870 and other projects. Inspiration and ideas for following Sweden s road to modernity have arrived from many quarters instruction and conversation with students, seminars with colleagues at the department, and visits to other departments of economic history around the country. Several people read late drafts of the manuscript and offered valuable feedback. I want to extend a special word of gratitude to Jan Glete at the Stockholm University Department of History, whose contributions were particularly numerous and generous. I would also like to thank Göran Ahlström, Jonas Ljungberg and Lars Svensson at the department in Lund. All responsibility for the final manuscript and any errors it may contain rests with me alone. Lund, April 2000 [9]

7 Ekonomisk historia engelsk_layout Sida 10 Preface to the Second Edition The final chapter of this edition covers events up to the first decade of the 21st century. While only a modest addition from the horizon of 200 years, it nevertheless illuminates the turn of the century from a long-term perspective. Lund, January 2007 Preface to the English Edition The translation follows earlier editions closely. The only extensions are references to recent development up to 2010, which was in line with the major long term perspectives of the book. Lund, December 2010 [10]

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