Industrial Subsidies in Sweden: Macro-Economic Effects and an International Comparison

Bo Carlsson
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Bo Carlsson: Research Institute of Industrial Economics (IFN)

No 58, Working Paper Series from Research Institute of Industrial Economics

Abstract: Between 1970 and 1978, industrial subsidies in Sweden rose from 4.9 % to 16 % of value added in mining and manufacturing. Most of this increase was due to increased wage subsidies to specific firms facing acute difficulties. The Swedish industrial subsidy program seems to be both larger in relation to industrial output and more selective than similar programs in Great Britain, Italy, Norway, and West Germany. Simulations on a firm-based macro model of the Swedish economy show that a selective wage subsidy yields higher industrial output, employment and export in the short run than alternative subsidy policies but also considerably worse economic performance in the longer term.

Keywords: Subsidies; Manucatruing; Industry; Wage (search for similar items in EconPapers)
JEL-codes: E24 H20 L60 (search for similar items in EconPapers)
Pages: 38 pages
Date: 1982-11
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:iuiwop:0058

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