A Historical-Institutional Study of the Welfare Systems in the United States and Sweden: Net Social Wage Approach

In this study I first look at the historical developments of the welfare systems in Sweden and the United States to understand why these countries have produced two distinct systems over the years. After understanding their historical context I turn to the question of the relationship between the welfare system and economic growth. Policy makers and the mainstream media commonly cite the critique that through government deficit and public debt, welfare systems are a drag on the economy. By calculating the net social wage, the difference in taxes paid and benefits received by workers, I test this hypothesis to see if welfare systems are self-financed by the workers. My findings demonstrate that the net social wage has been negative in the U.S. from 1962 to the early 2000s and in Sweden from 1965 to 2012. This shows that the welfare systems are entirely self-financed by the workers for the full period in Sweden and until the recent financial crisis in the U.S.

Life on the Edge: Patterns of Formal and Informal Help to Older Adults in the United States and Sweden

Objectives Our objective in this study was to compare assistance received by individuals in the United States and Sweden with characteristics associated with low, moderate, or high 1-year placement risk in the United States. Methods We used longitudinal nationally representative data from 4,579 participants aged 75 years and older in the 1992 and 1993 waves of the Medicare Current Beneficiary Survey (MCBS) and cross-sectional data from 1,379 individuals aged 75 years and older in the Swedish Aging at Home (AH) national survey for comparative purposes. We developed a logistic regression equation using U.S. data to identify individuals with 3 levels (low, moderate, or high) of predicted 1-year institutional placement risk. Groups with the same characteristics were identified in the Swedish sample and compared on formal and informal assistance received. Results Formal service utilization was higher in Swedish sample, whereas informal service use is lower overall. Individuals with characteristics associated with high placement risk received more formal and less informal assistance in Sweden relative to the United States. Discussion Differences suggest formal services supplement informal support in the United States and that formal and informal services are complementary in Sweden.