Scandinavian Working Papers in Economics

Institute for Futures Studies

No 2004:3: Organised Interests, Labour Market and Migration: the Swedish Model

Torbjörn Lundqvist ()
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Torbjörn Lundqvist: Institute for Futures Studies, Postal: Box 591, SE-101 31 Stockholm, Sweden

Abstract: My object in this paper is to examine what arguments unions and employers have presented regarding labour immigration and other immigration from a labour market perspective. My starting point is that both sides have interests to protect, and the aim is to examine these interests. A further aim, however, is to demonstrate the importance of arriving at a model in which these interests coincide. Based on past experience of labour immigration, we can make certain assertions about problems of principle and opportunities of various kinds. There are historical examples here of successful and unsuccessful approaches which may help us in our future actions in this area. In general, it could be said that the advantage of free immigration is that recruitment costs are comparatively low for employers, but also for the state. The costs of job-seeking are transferred to the applicant. In historical terms, free immigration has also been a prerequisite for the recruitment of large numbers of people. The immigration levels that pertained in 1945-1970 would not have been possible had free labour immigration not been permitted from a number of countries with a labour surplus. From a union viewpoint, this could be described as an employers’ market. Labour immigration, like other forms of immigration, affects institutional relations in the labour market. Various organised interests seek to influence the design of institutions that have either developed in response to the disruption of the established order or whose purpose is to solve problems that have arisen as a result of immigration. Institutional arrangements are affected by the way in which immigration is organised and by which groups gain support for their positions. In this paper, I argue that there is a conflict between recruiting costs and the unions’ interest in maintaining good order in the labour market. Quite simply, if there is great demand for immigrant labour, institutional arrangements would have to be introduced to cut down recruiting costs, which in turn is likely to benefit employers at the unions’ expense. The challenge facing us is to find solutions that strike a balance between the interests of the state, the employers and the unions.

Keywords: Labour Market; Labour Migration

JEL-codes: J61; J82

22 pages, June 2004

Price: 25 SEK

Note: ISSN 1652-120X ISBN 91-89655-51-6

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