Scandinavian Working Papers in Economics

Research Papers in Economics,
Stockholm University, Department of Economics

No 2008:8: A Social Innovation or a Product of Its Time? The Rehn-Meidner Model’s Relation to Contemporary Economics and the Stockholm School

Lennart Erixon ()
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Lennart Erixon: Dept. of Economics, Stockholm University, Postal: Department of Economics, Stockholm University, S-106 91 Stockholm, Sweden

Abstract: A wage and economic policy programme for full employment, price stability, growth and equity was developed by two Swedish trade-union economists in the early post-war period. A restrictive macroeconomic policy, a wages policy of solidarity and an active labour market policy are the cornerstones of the Rehn-Meidner model. The model was influenced by Hans Singer’s analysis of the fallacies of incomes policy under full employment conditions. However it is difficult to find equivalences in contemporary economics to the model’s composition of means and goals, functional relationships or to its emphasis on the role of actual profits in wage formation.

Keywords: Rehn-Meidner model; Swedish model; Stockholm school of economics; labour market policy; wages policy of solidarity

JEL-codes: B22; B29; E24; E62; E64; J31; J51

40 pages, September 16, 2008

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