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

Per-Anders Edin and Bertil Holmlund ()

No 4257, NBER Working Papers from National Bureau of Economic Research, Inc

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.

Date: 1993-01
Note: LS
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Published as Differences and Changes in Wage Structures, ed. Lawrence Katz and Richard Freeman, University of Chicago Press, 1995.
Published as The Swedish Wage Structure: The Rise and Fall of Solidarity Wage Policy? , Per-Anders Edin, Bertil Holmlund. in Differences and Changes in Wage Structures , Freeman and Katz. 1995

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