Fordism and the Swedish Model

Ilya Viktorov

Stockholm University


The paper examines the impact of fordism on the Swedish economy and its institutional structure during the twentieth century. Fordism is conceived as an industrial paradigm of mass production that is characterised by several key features on micro level: the use of special purpose machines, the division of labour in easy operations and production of standardized goods by semi-skilled workers. Fordism comprises the dominance of big corporations in national economy, centralisation of decision-making and stabilisation of costs and markets for mass production goods on macro level. The validity of the term “Swedish Model” is put under discussion and its traditional understanding as a model of centralised wage bargaining between national organisations of workers and employers is questioned. To make clear what specific features the Swedish economic development demonstrated, a comparative research between the USA and Sweden is made. The period between the early 1930s and 1970s is in focus. The conclusion is that two lands moved towards the same trend despite different cultural background and weight in the world market. The mass production corporations arose, welfare benefits were introduced to stabilise demand, and Keynesian macroeconomic policy was applied. The phenomenon of wage compression is the most essential in the context. Swedish historians traditionally ascribed wage compression that took place in Sweden until the early 1980s to the Marxist-inspired wage solidarity policy put forward by the Swedish trade-unions in the 1950s. But statistical investigations show that not only Sweden but the United States witnessed compression of industrial wages between 1940s-early 1970s as well. The centralised wage bargaining process explains these phenomena in both countries. The difference between two lands consisted in that whereas the wage formation in the United States economy followed the wage bargaining in the automobile industry, a corresponding process became more pronounced in Sweden. The main conclusion is that the Swedish model of industrial relations was not the result of the Swedish labour movement’s policy. Instead it implied an explicitly articulated variant of fordism and centralisation of industrial relations posed by development of mass production in Sweden.

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