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Social welfare in Sweden

The welfare system in Sweden is composed of three main parts, which are
the social welfare, education and employment; each of the three is mostly
funded by taxes (at the central and local levels) and utilized by the public
sector. In this regard, there are government bodies, responsible for the
smooth functioning of the system: the Ministry of Health and Social Affairs, of
the Ministry of Education and Research, and the Ministry of Employment 1.
The social welfare part includes but is not limited to financial security in the
case of illness, old age and for the family; social services such as health care
for adults and children, assistance to disabled people etc. By and large,
several agencies such as National Agency for Social Insurance and local
municipalities are responsible for redistribution of about 48% of the Swedish
GDP in the form of taxed income.
In education, the welfare focuses mainly on providing pre-school services
and childcare for schoolchildren as well as adult education.
Population ageing as a background for the modern welfare system
Sweden has been experiencing population ageing over more than 100 years,
when the share of elderly has more than doubled. Given existing obstacles
in elderly care as well as healthcare in general, the question is how
Sweden will cope the increased population and sustain economic
growth at the same time.
The population pyramid in 1900 for Sweden (see Fig. 2.1) seems to have a
more classic pattern, with a lot of younger people successively tapering off
with increasing age to a pointed top, the phenomenon common in all
agricultural societies of the past and seen in many developing countries
In the twentieth century, the share of the population over 65 years old more
than doubled, reaching 17% by the end of the century. This lead in turn to a
changing pyramid from traditional to the more urn-shaped age structure,
with a smaller base and wider top.
One of the reasons why the share of t h e elderly increased is that life
expectancy increased and people are living longer. Indeed, life expectancy at
birth in Sweden has increased from 35/38 for men and women respectively in
1750, up to the 77 and 82 years correspondingly in 2000, with projections for
further increases to 83 and 86 years by the year 2050.



Yet the main reasons for population ageing is considered the declining
fertility. Truly so, according to A. Coale, had fertility rates remained the same,
the age structure would mostly have been the identical in 1950 as in 1860,
despite substantial increases in life expectancy during this period. In his
work, he demonstrated that the population ageing occurred in the first half of
the twentieth century was almost entirely the consequence of fertility drop2.

Fig. 2.1 Population Pyramid for Sweden

Source: BiSOS and Befolkning (Statistics Sweden)

Indeed, the fact that fertility, and not mortality, has been the engine of
population ageing may appear contradictory. T. Bengtsson and K. Scott imply
that it is easy to confuse population ageing with individual ageing,
especially in light of the dramatic increase in life expectancy experienced in
industrialized countries. It is nevertheless important to make this distinction,
between the fact that life expectancy increases and the fact that the share of
elderly in the population increases.3 Thus, the phenomenon when higher
fertility rates lead to larger generations, received the name as positive
population momentum; when the otherwise effect takes place, one may
expect negative population momentum.

Coale, A. J., How the age distribution of a human population is determined. Cold Spring Harbor Symposia on Quantitative Biology,
22, 1957, pp. 8389.

Bengtsson T., Scott C., Population ageing - a threat to the welfare state? The case of Sweden, Ch. 2, Demographic Research
Monographs, 2010, p. 11