Nordic model

The Nordic model comprises the economic and social policies, as well as typical cultural practices, common in the Nordic countries (Denmark, Finland, Iceland, Norway, and Sweden). Historically, this included a comprehensive welfare state and multi-level collective bargaining based on social corporatism, and a commitment to private ownership within a market-based mixed economy. Norway is a partial exception due to a large number of state-owned enterprises, state ownership in publicly listed firms, and its sovereign wealth fund. Although the Nordic countries retain significant differences, they share some common traits. The three Scandinavian countries are constitutional monarchies, while Finland and Iceland became republics in the 20th century. All the Nordic countries are described as democratic. All have a unicameral legislature and use proportional representation. They all support a free market and universalist welfare state aimed specifically at enhancing individual autonomy and promoting social mobility, employing a sizable percentage of the population (roughly 30% of the work force in areas such as healthcare, education, and government), and a corporatist system with a highly unionized workforce. Representatives of labour and employers negotiate wages and labour market policy mediated by the government. As of 2020, all of the Nordic countries ranked highly on the inequality-adjusted HDI and the Global Peace Index, as well as ranking in the top 10 in the World Happiness Report. The Nordic model was developed in the 1930s under the leadership of social democrats. Centrist and right-wing political parties, as well as labour unions contributed to its development. The Nordic model gained attention after World War II. It has continued to evolve, including decreased regulation and expanded privatization. However, it is distinguished from other models by its emphasis on public services and social investment.