Knowledge on the Nordics
Knowledge on the Nordics
Uncovering the Nordic Model with Caroline de la Porte
Listen to this nordics.info podcast if you are interested in finding out more about:
- The traits of the Nordic Model;
- Examples of policy successes and policy challenges in the Nordics;
- The relationship between the Nordics and the EU;
- The provision of universal services, like early years childcare in Denmark and Sweden.
Editor of nordics.info Nicola Witcombe interviews Caroline de la Porte, a European political economist and Professor at the Department of International Economics, Government and Business at Copenhagen Business School. This is the seventh virtual visit around the Nordic countries in the podcast series ’The Nordics Uncovered: Critical Voices from the Region’ and was recorded in April 2021.
The Nordic model is lots of different things to lots of different people. Can you sum up what the Nordic model is to you?
Caroline De la Porte:One of the challenges with conceptualizing the Nordic model is that there are some features which can be found in many other countries. But there are features of the Nordics, which are specific to the Nordic countries. One is a high level of generalized trust, and this is in all aspects of society. It is not a very hierarchical society. Of course, there are hierarchies, there are classes, but hierarchies and classes are a lot less fixed and structured and formalized, compared to another systems of political economy. And then a very central feature, in my opinion about the Nordic models is the welfare state.
Nicola Witcombe:Welcome to the seventh podcast in the series,
The Nordics Uncovered:Critical Voices From the Region from the research dissemination website, Nordics.info. Caroline De la Porte, who is a European political economist with a specific focus on the welfare state social policy area is professor in the Department of International Economics, government and business at Copenhagen Business School. And in this podcast, as you just heard, she will be talking about the Nordic model, as she and many other scholars acknowledge, conceptualizing the Nordic model is difficult. The Nordic countries are all different, there is not just one model. Many countries outside the Nordic region have similar traits as those within the region. So it's not necessarily just Nordic. So can it really be a useful term? What is actually meant by it? In this podcast, Caroline, and I, Nicola Witcombe, the editor of Nordics.info, first discuss aspects of the Nordic model, we go on to look at what are considered some of the policy successes and some of the policy challenges. And then we drill down on the provision of universal services with respect to early years childcare as a specific case study. So Caroline, you've already said that you think a key point of the Nordic model, and I'm sure lots of people would agree with you is the welfare state. So let's go through some of the aspects of the welfare state that are characteristic of the Nordic model.
Caroline De la Porte:So the welfare state is based on general taxation. So that means that all citizens contribute to the welfare state, in turn, all citizens then have the same rights in areas that have to do with dealing with social risk. So health care area, the services and access are free of charge, and universal and have relatively high quality. This has changed over the years. But still, overall, it's a relatively good health care system. And this is in contrast to, for example, the US system, which is a lot more costly, and where you see also the class based differences in terms of health care outcome. And then areas such as family. Family policy are also central in the universal welfare states. So this includes not only childcare benefits, which you have in most other advanced economies as well. So what's really distinct isn't the cash part of the welfare state, it's the services. So high quality health care services, high quality childcare services, there is a fee, but it's a very small fee, and it's very heavily subsidized. Schooling, which is also free of charge. There is also what's called a private schooling system, but it's actually subsidized. And the purpose is not a market based versus a public solution. It's more about being able to organize schools in a different way, for example, having more space for some particular values or ways of learning and so on. So So these services are really what makes the welfare state particular.
Nicola Witcombe:So let's turn to the labor market, because that is obviously a key tenet of the Nordic model and is often talked about in the other European countries.
Caroline De la Porte:So active labor market policy - if individuals become unemployed, they have the right to an unemployment benefit, but they also have the requirement to search for jobs and to participate in some training and education. So the active labor market policy and especially the Danish flex security model is seen as a model for emulation, because it enables individuals to have some not job security, but to have some benefit. And the whole flex securities system is built on the notion of Employment Security, which means the right to always have access to a job, rather than to have a specific job. The challenge, then, is that many countries have flexibilized their labor market. So that means making it less costly to fire people. But at the same time, they haven't necessarily integrated the activation dimension to the same extent. In other words, high quality training programs in order to find other jobs. And unemployment benefits are not so generous. Still, they're less generous in in the Nordics and they what they were 20 years ago. But still, it's a specific feature of the Nordic model, or which is less present in other countries, but it has been diffused and adopted in other countries as well.
Nicola Witcombe:So let's just take a moment to talk about flexicurity. Because it's a term that is waved around a lot. If I'm right, what it actually means is that the job market is fairly flexible, and that people can be sacked fairly easily. But there's a security net when they lose their job. There's some sort of employment insurance, which in the Nordics is often linked to trade unions. Does that sum it up? Or are there any other aspects that we should be thinking about?
Caroline De la Porte:Another aspect, which should be recalled is that individuals also move around on the labor market voluntarily so that it's not that everybody is sacked and then they have to find alternative jobs. There's an unusually high proportion of individuals changing jobs for a variety of reasons in Denmark, compared to in most other advanced economies. And only a proportion of those have been set a small part of them, many of them choose voluntarily to move around labor market, although often in the same sector.
Nicola Witcombe:Yes, it's a kind of dynamic labor market in a way. We've mentioned schooling, but it would be useful here to also hear something about training and education for older people, and how that sort of dovetails with flexicurity and the labor market and so on.
Caroline De la Porte:It's slightly separate, but it's linked as well. So basically, there's a comprehensive system, also of vocational training. Overall, the skill level in the Nordics is very high. And so this is not only academic types of skills, but also skills are among other categories of workers. So overall, the skill level is is high, I'd like to connect to another theme. So it's not just the welfare model, or the labor market model. But it's also this idea that individuals are active throughout their lifetime in different ways. And this means that there's a very strong association between the Nordic countries and what's called the social investment perspective.
Nicola Witcombe:Yep. Interesting. Could could we dwell on that? Could you say a bit more about the social investment perspective,
Caroline De la Porte:Social investment refers to the state, but also, for example, social partners, investing in the skills of individuals throughout the life course. And this is visible in all areas of life in the Nordic countries. So childcare institutions are not only places to get children taken care of, but they are also seen as being valuable for children and parents prefer to have their children in childcare, rather than outside of childcare, because there are field staff that develop pedagogical programs to invest in the skills of children. So this starts from the very small children. And of course, especially during childhood and early adulthood in the training and investment in skills, development is high. But even in later life skills development is present on the labor market in various different sectors throughout, especially for people having a job, but also people not having a job.
Nicola Witcombe:So we've arrived on child care, and we'll return to that as a detailed case study later on in the podcast. But before that, I just want to stay on the Nordic model, generally, and I know you've looked at many different and social policy areas within the Nordic model, and you've been a part of many different research projects to do with it as well. It would be useful to have a couple of specific examples. First, in relation to policy successes, I believe you're currently working on a volume with other scholars. And those examples don't necessarily have to be from your own research. They could also be from other other people's research.
Caroline De la Porte:I'd like to mention two from Finland, which I find quite interesting and which we can link back to the issue of trust. So one is on the Finnish military conscription. Okay, so normally in Denmark, if you think about the military services, there's not necessarily a positive identity building connotation with this. But in Finland, it's a requirement for all men to do military service. And this is something which even for Finns having lived abroad most of their lives, they go back to Finland to do their military service. And, of course, this is just anecdotal. But you know, my brother, he did his military service in Finland and he said, this is one of the best moments he's ever had in his life. So it has a, you know, an identity building function. And perhaps a precondition for that is that there is a trust base. And at the same time, it also contributes to maintaining a level of of trust. That's not normally what you would associate with the military. But it's also seen as being valuable then when people entered the labor market that they've done their military service, and so on, even if it's just for six months. Then there's another case, Finnish case, which is the baby box. And now it's been emulated in lots of other countries, but the baby box is a box of essential goods that is given to all families at the time of childbirth. And this was initially developed at a time when Finland was considerably poorer, and was seen as a great help to families at the start of children's lives. Now, of course, the situation has changed. But this has been emulated in a number of countries also in a number of developing countries in Africa. So those are two Finnish cases, which I quite like as you know, from a policy success perspective, because it's also backed up by the political parties from the left to the right. And also among citizens.
Nicola Witcombe:While we're on successes. I know your background is in European social policy. And could we take a minute to look at how the Nordics have have influenced the European states and union and vice versa, perhaps? In some ways, the policies of the Nordics can be seen as a success in that arena, can't they?
Caroline De la Porte:At the level of ideas, the Nordic model has had some some traction at EU level during the last 20 years. With the broader welfare state areas such as organization of labor markets, active labor market policy, even areas like childcare, the Nordic countries are taken as examples at the EU level. And then the EU level suggests that these are models to emulate for for other countries. These countries' way of organizing is very specific and has been seen in a way as an optimal way of organizing society. Of course, there are also some drawbacks, but still positive features of the model is what has been also looked at from the EU level. More recently, there is a work life balance directive at EU level, which aims to increase the role of fathers in care for very small children. And here it is, more specifically the Swedish parental leave model, which is seen as a success. Even of course, the recipient member states, they don't necessarily implement all of these aspects. Still, it serves as a as one possible way of organizing the relationship between states markets and families.
Nicola Witcombe:So we've just discussed the influence, if you like and the diffusion of Nordic social policy in other European countries. What about the other way? Could you comment on how the Nordics have integrated European principles?
Caroline De la Porte:The EU has had only a minor impact in Nordic countries, but still significant in areas like gender equality and anti discrimination. My PhD was about the influence of the Nordic countries on EU social policy, and also the impact of European social policy on member states. And Denmark was in that context, a reluctant European just because it seeks to defend its own social model. And this contrasted in fact, with the attitude to EU and social policy in some of the other countries in Finland and Sweden, where there was a more positive attitude. I'm simplifying a bit, but the civil servants working with reporting to the Commission what they do in different policy areas, they often highlight that the EU can learn from from Denmark. But Denmark has very little to learn from the EU. And then the social partners in the Nordic countries, they're very skeptical about EU legislation in particular, because they feel that it undermines their authority in the labor market area, because labor market is policy and law is developed by the social partners in the different sectors.
Nicola Witcombe:Okay, so we've kind of looked at successes. And I know you've obviously also look at the downsides of the Nordic model genuinely and social policy. More specifically. And you've currently got a project on the challenges of the Nordic model. Could you describe some of those?
Caroline De la Porte:I have one project about challenges, which is beyond specific policy areas. Are there some challenges such as digitalization, the platform economy, Europeanisation, fiscal restraint, permanent fiscal restraint in conjunction with aging populations? What does this mean for different aspects of the Nordic model, the welfare state and the labor market in particular? And the question is, it's not just is there savings in a specific area, but it's more a questioning about are the five fundamental qualities of the Nordic model being undermined? In other words, the trust based of the society, the labor market model, which is also based on trust with the unions and the employers regularly negotiating a working conditions and wages for their members, and so on. And actually, what we find in that project is that there are a lot more differences among the Nordic countries, then we expected. Yet, institutionally, the trust based governance systems and decision making are still present. But I would say that they are threatened from very many different perspectives.
Nicola Witcombe:That's great. That was an interesting overview. Thanks for that we're not going to dwell too much on this project and the challenges, as it was the subject of an earlier podcast by Knowledge on the Nordics called the "Nordic
model at risk:Conversations on Regulation". And that's available on our web page. So now we're turning to child care, which is going to be a case study, if you like. And you've recently been involved in some research in this area, specifically to do with the group of children from six months of age to three years of age.
Caroline De la Porte:So what we've seen in the Nordic countries in general is as the participation of women on the labor market has been increasing, then family policies to support the possibility for women to participate in the labor market has been very important. And of course, these have developed in different ways in different countries. So they're not all equal. But if we focus on the Danish case, which really is is distinct, even among the Nordic countries, I'm working on this area together with Trine Larsen from the University of Copenhagen. And, you know, what I'm presenting is based on our common research and thinking about this area. There has been from the 60s until the 1990s, and expansion of childcare, so making it more available, and this then culminated in 1998, with a childcare guarantee, so the right for all children to have a place in a childcare institution. So here I'm talking about the very small children from the age of six months up to the age of three years and after that it's kindergarten. Kindergarten is also of high quality in the Nordics, but It's like so many other things. It's not distinctive for the Nordic countries. Kindergartens and the participation of children in kindergartens from the age of three to six is present in very many countries. In some countries, it's called preschool and so on. But I mean, basically, it's the same. So what is really distinctive is the availability of high quality childcare institutions for the very small children from the age of six months up to the age of three years old. So this is in Denmark has been made broadly available. And it's not only that it's broadly available, but there's a high use of childcare institutions by parents. So parents back it up, they think it's a good idea, and not only to participate on the labor market, but because it is seen as a means to socialize, but also to develop the skills of children.
Nicola Witcombe:So you talk about being high quality, but in what ways is that high quality? How do we know that?
Caroline De la Porte:One of the features is that the staff working in childcare institutions have a high level of qualification. And this enables them to be able to actively invest in the skills of children. And so the enrollment of small children in childcare is in fact, the highest in Denmark, I mean, the highest not only among the Nordics, but also globally. There's not as much enrollment in childcare in Finland and Sweden, as there isn't in Denmark. But anyway, it's quite unique. You know, it also prepares children for being able to learn. So even the the unions representing the pedagogues, you know, they have all of the vocabulary and knowledge about the social investment aspect of childcare. So Trine and I, we had an interview with the unions recently, and one of the respondents mentioned the Heckman curve, so the Heckman curve, what is that, that refers to the fact that the learning curve for individuals is very high in the very early years. This means that in case children don't are not stimulated in the early years to be able to learn later, it becomes much, much later, much, much more difficult later to catch up, you know, and so when they, you know, talk about the hitmen curve, you know, then that tells you how institutionalized the whole idea of social investment is in childcare. And that's also the thinking by parents that it's better for their children to be in childcare, then at home.
Nicola Witcombe:Yeah, that's interesting. It reminds me of the shore start scheme under the Blair brown government in the UK, where they took those principles about early years being very important also for later life and invested in that period. But of course, the financial crisis came, and a lot of the things that they introduced were clawed back, often they were surrounded, it was around local libraries, and a lot of those shut down, for example. Comparing it to the Nordic countries, you can't really imagine that facilities for early years education would it ever be clawed back, could you?
Caroline De la Porte:It's true, but there is also some contestation between the left and the right, in the sense that the left highlights the issue of quality and childcare. And even among the left, there is a debate about which issues are more important. So for the Socialist Party, they have historically been the party that has been most active in arguing for having a high proportion of adults to children. Whereas the social liberals, they say, okay, the number of adults is important, but it has to be qualified adults, because they have to then later in life, learn more and participate on the labor market. So there is a kind of a, you know, a socialist party. Yes, it's a social investment, but it's also the care. And for the social liberals, it's really the investment part, which is important.
Nicola Witcombe:So we're talking specifically about the political parties in Denmark.
Caroline De la Porte:Yes, yes. And I think the debate in Denmark is quite specific also, because the whole idea of the social investment part is more prominent in Denmark. But on the right, you have a slightly different perspective. So for them, the most important is to have long opening hours of daycare institutions. So it's more about supply than it is about quality. Of course, they also think it's a good idea. And then there are some parties who actually think okay, we should there should be free choices. should also be free to choose to be at home with your child if you don't want to participate in the labor market. So there's the more conservative values, which are present, especially for parties like the Danish People's Party. So while there's an overall support for childcare, when you look beneath the surface, then there are slightly different views among the political parties. Nevertheless, during the financial crisis, there were also cutbacks in Denmark. The municipalities, which are responsible for organizing social services in their municipality, they can choose where to prioritize and where to cut. But what we see is that overall, there were cuts in the childcare area during the austerity years following the financial crisis from 2007. So it's not just in the political sphere, but also at the grassroots level that the issue of continued quality of care has come on to the political agenda.
Nicola Witcombe:Yes. And hasn't there been a bit of a backlash against the austerity of that period? So the financial crisis also happened in the Nordic countries, of course.
Caroline De la Porte:There was a mobilization among various actors. So these political actors we just talked about, especially on the left, were very active, talking about having a certain number of adults for children, especially qualified adults. And at the same time, there were a parent's group folder, which has emerged and put the issue of quality of care on the political agenda. And this has also been backed up by union. So this then culminated in a decision in 2019, by the current minority, social democratic government, to have a minimum ratio of three children to one adult for early childhood education and care, and one adult to six children in kindergartens.
Nicola Witcombe:So prior to 2019, was there a legal requirement for a specific ratio was it up to the municipality
Caroline De la Porte:Up to the municipality. So now, in a way, or? that also puts pressure or creates a tension between the national level of governance and the local level of governance because the local level of governance is used to having autonomy to organize social services, including childcare the way they want it, but now they have to live up to this requirement.
Nicola Witcombe:Just a point of clarification. So we've got this ratio from six months to three years old, three children to one adult, does that adults have to be a qualified pedagogue? Or can it just be a pedagogical assistant?
Caroline De la Porte:In general, the problem during the financial crisis has also been that the childcare institutions have increasingly been using non qualified staff because they are cheaper, the decision of three to one does not have the requirement of qualified pedagogue staff. That means that the municipalities can be creative in the way they meet the norm. So they can include the leaders of the childcare institutions, they can include the cleaning staff, and non qualified staff taking care of the children, the hope is that it will be possible to nevertheless have a high proportion of qualified staff.
Nicola Witcombe:So we've talked about Denmark with respect to early years child care. I know you've also done some research on child care services, together with also linquist from Lund University in Sweden. Could you tell us a little bit about the differences between Denmark and Sweden in this regard, because it also reflects some of the wider differences of the two countries way of doing things.
Caroline De la Porte:So in Sweden, one important distinction with Denmark is that there is possibilities for private for profit organizations to organize childcare. That's a huge difference. In Denmark, it has been possible legally, but I mean that it basically hasn't materialized to a large extent. In Sweden, it has materialized so you have some companies that simply make a business out of this. And that changes the dynamic completely. And that was introduced already a long time ago. And the requirements for qualified staff are not as high in Sweden as they are in Denmark. In Denmark, there's a three year pedagogue education after high school. In Sweden, it's a three year education as a vocational training program at gymnasium level.
Nicola Witcombe:Yeah, I should just add that the gymnasium level that you're talking about is the level of high school from about 16 years. So the pedagogues, or nursery nurses in Sweden have also significantly younger. Yeah, are there any other prominent differences between Sweden and Denmark?
Caroline De la Porte:In Sweden, the municipalities have more autonomy visibly at the national level compared to in Denmark, where it's the national level which sets the regulatory requirements and norms. So the municipalities in Sweden don't have the same requirement to follow norms from the national level. In addition to that, in Denmark, most of the funding for social services comes from the national level to the municipal level in a lump sum. Then there's additional taxation that can be collected at the local level. But in Sweden, it's different. In Sweden, the municipalities collect most of the money themselves, meaning that they're more autonomous. This also means that in poorer municipalities, there are a lot less resources compared to enricher municipalities, there are hidden inequalities in both countries, but they're much more pronounced in Sweden than they are in Denmark. In Denmark, there's more top down financing, top down regulation. So that's a very important difference. And in addition to that, there's a higher use of non qualified staff. There's a greater difference between urban and rural areas in Sweden than there is in Denmark. So the availability of care is high in urban, urban areas. And it's, you know, it's a mix of the public and the private. But in the urban areas, there's very little availability, all together, and it's simply difficult to get qualified staff. And so then there's non qualified staff.
Nicola Witcombe:We've talked in detail about child care and how it works in practice. We've taken that to be a success, generally from a global perspective. Are there any downsides to it?
Caroline De la Porte:The problem is that the political discourse about the insiders and outsiders is present in all areas of political life. So there are areas in Denmark, where there are a high proportion of third country immigrants, that means non EU citizens, typically Muslims. And in these areas, the government decided that there should be a higher proportion of children in early childhood education and care, in order for them to socialize in today's society, and also from a social investment perspective. Where these families are then forced to put their children into childcare at the age of six months, full time childcare may not be what all parents would like. There are some studies that suggest that the discourse that these children do not use childcare is overstated. They typically start childcare a little bit later, but they also use childcare, the identification of the non Europeans and Muslims as different and not being able to integrate and so on, is also present in the childcare area.
Nicola Witcombe:Yeah, it's interesting that you talk about it in that way, because I also experienced that when I moved to Denmark. That I had the people looking after my children, telling me what to do, telling me to speak more Danish at home, telling me to pick them up later. Even though I wanted to spend more time with my children.
Caroline De la Porte:The nanny state, right, and the nanny state wants to take care of your children, even if you may have another preference. So it's kind of the state being overly dominant in the private area.
Nicola Witcombe:So as you know, the previous participants who I interviewed was Cathie Jo Martin from Boston University. She's a political scientist. And I know you've worked with her before, and she put the following question to you. She knows you've done a lot of work on small states and written on small states. Are there any lessons that you can take from that body of research that can be applicable to large states like America where she lives?
Caroline De la Porte:That's a really big question. I would say that the consensus based decision making in all areas of life is super important for being able to develop decisions, which can satisfy different types of actors, different types of users with different types of needs. Obviously, you have the labor market model, where employers that are more interested in growth, productivity and so on, and then the employee who wants good working conditions and wages. So the tradition of collaborating together with regards to working conditions and wages is really very particular. And also you see this in political life as well, it's not only for Nordics, but you know, for countries with coalition building types of systems. There is a tradition of having a dialogue in order to find a solution which can satisfy different perspectives across the political spectrum. And in the US, or even in the UK, the challenge, I would say is that the political debate is often very polarized, and also the two bigger political parties are the ones where you have different views, which are subsumed. And ultimately that makes decision making very politicized rather than focusing on what the issue actually is. So I would say that that's an important takeaway. And another one is related to the to the welfare state, and where in the US, the welfare state is seen, as is associated with negative stigma. In the Nordic countries, you know, "folkehjemmet","folkehemmet","velfærdssamfundet", all of these notions are associated with a positive connotation, and these help to build trust and identity. Of course, it's difficult in a big country, and also a federal system to organize it in the same way. But still, there are probably some, some lessons can be that can be learned in terms of decision making, to move from a polarized to a more consensus based approach.
Nicola Witcombe:So Caroline, I know you have to go, we've talked for far too long, but it's been a really interesting discussion. Thanks so much.
Caroline De la Porte:I really enjoyed it. Thanks a lot.
Nicola Witcombe:So Caroline routes me following the podcast and provided me with a question for the next person I'm interviewing. That is Miika Tervonen from Helsinki University. And she has asked him, "How are various migrant groups being integrated in Finland?" "Are the distinctions among different groups in terms of policies and in terms of discourses and stigmatizations?" So please join us next time for an interview with Miika Tervonen where we'll be talking about migration, borders, nationalism, ethnicity within the Nordics, and particularly Finland. You've been listening to nordics.info podcast. Thanks go to Caroline De la Porte, to our own research hub, Reimagining Norden in an Evolving World, and our funders NordForsk. If you'd like to find out more, please visit nordics.info