APPROACH
Swedish Rehn–Meidner model
The Rehn–Meidner model was a coordinated Swedish trade-union policy program: compress wages, help workers move toward more productive employment, and restrain inflation while pursuing full employment and growth.
Sources for this overview 3 claims
attributed value
Rehn and Meidner advocated combining full employment and fair wages with price stability and high economic growth.
definition
The Rehn–Meidner model combined solidaristic wage policy and active labor-market policy with restrictive macroeconomic policy over the business cycle.
classification
Sweden never consistently applied the full Rehn–Meidner package, although the late 1950s to early 1970s combined an expansion of active labor-market policy and solidaristic wage policy during the model's strongest period of influence.
Overview
What should you know?
A model built around several goals at once
Gösta Rehn and Rudolf Meidner sought to combine full employment and fairer wages with price stability and economic growth. The interest of the model lies in treating those aims as a joint institutional problem rather than choosing only one.
Sources for “A model built around several goals at once” 1 claim
attributed value
Rehn and Meidner advocated combining full employment and fair wages with price stability and high economic growth.
How the parts were meant to work together
Solidaristic bargaining would narrow wage differences; active labor-market measures would support employment and movement toward expanding activities; restrictive general macroeconomic policy would limit inflationary excess demand. The model depended on the combination, not on wage bargaining alone.
Sources for “How the parts were meant to work together” 3 claims
definition
The Rehn–Meidner model combined solidaristic wage policy and active labor-market policy with restrictive macroeconomic policy over the business cycle.
definition
The model paired selective employment support with mobility-enhancing adjustment measures intended to sustain employment and move labor toward expanding activities.
definition
The model called for restrictive general fiscal policy over the business cycle to restrain inflationary excess demand while selective policies pursued employment and adjustment.
A model, not a name for Sweden
The program became influential in a social-democratic setting shaped by organized labor, but Sweden never applied the complete package consistently. Its strongest period of influence combined only some of the model's components.
Sources for “A model, not a name for Sweden” 3 claims
classification
The Rehn–Meidner model became influential in a Swedish setting shaped by Social Democratic government and organized labor, but it remained a distinct program whose components were adopted unevenly.
classification
Sweden never consistently applied the full Rehn–Meidner package, although the late 1950s to early 1970s combined an expansion of active labor-market policy and solidaristic wage policy during the model's strongest period of influence.
observation
Sweden expanded active labor-market policy from the late 1950s into the early 1970s, during the period Erixon identifies as the Rehn–Meidner model's strongest practical influence.
What the bounded evidence supports
Swedish wages compressed sharply from the late 1960s, especially during the 1970s. Research supports a productivity contribution from narrower interindustry wage gaps, but not from wage leveling within industries and workplaces; another study also cautions against attributing Sweden's earlier restructuring peak to the later wage compression.
Sources for “What the bounded evidence supports” 3 claims
observation
Swedish wage inequality remained stable from the introduction of centralized bargaining until the late 1960s and then declined rapidly; Molinder attributes a substantial part of the 1970s decline to deliberate union policy.
observation
Molinder finds that declining wage dispersion coincided with falling growth and structural change, challenging a simple claim that solidaristic wage compression generated the earlier restructuring peak.
observation
Hibbs and Locking find that reduced interindustry wage differentials contributed positively to aggregate output and productivity growth, while finding no support for productivity gains from wage leveling within workplaces and industries.
REFERENCE
Inspect the model
Open the formal relationships and evidence behind the summary.
Purpose and proposed institutions
Attributed purposes
Equality with employment
attributed value
Rehn and Meidner advocated combining full employment and fair wages with price stability and high economic growth.
Proposed institutions
Active labor-market adjustment
definition
The Rehn–Meidner model combined solidaristic wage policy and active labor-market policy with restrictive macroeconomic policy over the business cycle.
definition
The model paired selective employment support with mobility-enhancing adjustment measures intended to sustain employment and move labor toward expanding activities.
Restrictive macroeconomic demand management
definition
The Rehn–Meidner model combined solidaristic wage policy and active labor-market policy with restrictive macroeconomic policy over the business cycle.
definition
The model called for restrictive general fiscal policy over the business cycle to restrain inflationary excess demand while selective policies pursued employment and adjustment.
Solidaristic wage bargaining
definition
The Rehn–Meidner model combined solidaristic wage policy and active labor-market policy with restrictive macroeconomic policy over the business cycle.
observation
From 1956 to 1983, Swedish solidaristic wage policy operated through coordinated peak bargaining with industry and workplace implementation rather than through one uniform wage fixed centrally.
Cases and evaluation
Bounded practice
qualified / partially instantiated
Centralized solidaristic bargaining, 1956–1983
The period in which peak-level solidaristic agreements structured Swedish wage bargaining before central bargaining broke down.
Questions and criteria
Who captures gains from productivity, wage restraint, and capital ownership—and how can that distribution change?
Ownership, control, income, and wealth are distinct but interacting outcomes.
Distribution: Who receives income, wealth, control, benefits, and adjustment costs?