Economics Explained The Economy of Sweden
May 26, 2024
Exploring Sweden's remarkable economy with high living standards, robust labor laws, and the oldest central bank. The country achieves impressive societal well-being despite lacking natural resources. Sweden's low Gini coefficient and emphasis on income equality through taxation system and welfare support. Balancing income equality and wealth inequality through strong welfare system and entrepreneurship. Sweden's unique economy focuses on sustainability, innovation, and liberal market policies.
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Oldest Central Bank Legacy
- Sweden's Riksbank, founded in 1668, pioneered central banking and modern monetary policy.
- That long institutional history helped shape global central banking practices.
Low Income Gini, High Equality
- Sweden's income Gini is low (0.27 in 2018), making it one of the most equal developed countries.
- This equality lifts average workers and compresses wage differences across professions.
High Top Marginal Tax Early
- Sweden's top marginal income tax reached about 56.9% by 2019 and applies at relatively low incomes.
- As a result, many more people face high rates, compressing post-tax incomes.