by Jim Rose in applied welfare economics, economic growth, economic history, macroeconomics, Marxist economics Tags: endogenous growth theory, envy, Leftover Left, politics of envy, Sweden, top 1%

#Sweden: Inequality decreased hugely in the 20th century – but is now rising. bit.ly/1DEBY1P https://t.co/MHPgp29AWZ—

Max Roser (@MaxCRoser) October 24, 2015

A fall in the share of the top 1% of total Swedish total incomes was in tune with the emergence of a new word in the English language which was Swedosclerosis. That was the long stagnation in the Swedish economy in the 1970s and the 1980s with Swedish economic growth well below that in the trend rate of growth in the USA. Only after an increase in the top 1% share in Sweden did economic growth start recovering to trend.

Source: Computed from OECD StatExtract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/



In the chart above, a flat-line in real GDP per working age Swede is growth at the trend rate of the US economy for the 20th century which was 1.9% per year. A falling line is Swedish growth below trend, a rising line is growth above that trend rate of 1.9% in Sweden. A trend rate of 1.9% is the trend rate of growth currently used by Edward Prescott for the USA in the 20th century.