Working Paper No. 15

Pay Differentials between Government and Private Sector Employees in Sweden


The human capital model predicts that in equilibrium and in the absence of discrimination units of human capital possessed by individuals are paid the same rentals. This would hold also when comparing private and government sectors. Only non-pecuniary rewards such as better job security of fringe benefits would lead to acceptance of lower money payment. In Sweden salary differentials standardized for human capital variables are found to be in favour of private sector employment. This result contrasts with recent findings for the USA where the reverse was found.

Interdisciplinary European Studies

The European Union and the Return of the Nation State

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This book explores the complex and ever-changing relationship between the European Union and its member states. The recent surge in tension in this relationship has been prompted by the actions of some member state governments as they question fundamental EU values and principles and refuse to implement common decisions seemingly on the basis of narrowly defined national interests.

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