Working Paper No. 1079

The Turnaround of Swedish Industry: Reforms, Firm Diversity and Job and Productivity Dynamics

Published: September 1, 2015, revised November 2015Pages: 41Keywords: Regulations; Allocative efficiency; Productivity; Job dynamics; Matched employer-employee data; Industrial structure and structural changeJEL-codes: D22; E23; J21; J23; K23; L11; L16; L51

The Turnaround of Swedish Industry: Reforms, Firm Diversity and Job and Productivity Dynamics Fredrik Heyman, Pehr-Johan Norbäck and Lars Persson

This paper examines the Swedish industrial reorganization process that took place from 1990-2009. We argue that the early adoption of information and communication technology (ICT) in Swedish industry was a crucial element in the success of the industrial restructuring process. We also argue that several reforms in the 1990s mitigated the insider-outsider problem in the labour market and incentive problems in the Swedish business sector: the deregulation of the wage negotiation system, the deregulation of product markets, and the deregulation of the market for corporate ownership. The main prediction that results from our institutional examination is that technological change and economic reforms benefitted more productive firms and factors while punishing less effective firms and factors. We find support for our thesis by using detailed matched plant-firm-worker data. 


Fredrik Heyman


Ph: +46 8 665 4537

Pehr-Johan Norbäck


Ph: +46 8 665 4522
Mob: +46 73 574 3379

Lars Persson


Ph: +46 8 665 4504

Interdisciplinary European Studies

The European Union and the Return of the Nation State


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.

About the book


Seminars organized by IFN


To present ongoing research informal brown-bag seminars are held on Mondays at 11:30 am. This is an opportunity for IFN researchers to test ideas and results.

Academically oriented seminars are most of the time held on Wednesdays at 10 am. At these events researchers from IFN and other institutions present their research.

In addition, IFN organizes seminars open to the public. Topics for these are derived from the IFN research.

Research Institute of Industrial Economics, Grevgatan 34 - 2 fl, Box 55665, SE-102 15 Stockholm, Sweden | Phone: +46-(0)8-665 45 00 |