Analysis of the Sustainability of Nordic Welfare Model in Times of Essay

Analysis of the Sustainability of Nordic wellbeing Model in Times of Economic Recession - Essay ExampleThe first challenge for Nordic countries is the demographic shift. The population in the entire developed world is greying and Nordic countries are no exception. With the affix in longevity of people and reduced child births, the number of people above the be on of 65 is rapidly increasing (Adema, 2001). all(a) Nordic countries provide generous pension facilities to enable the old to jazz a life of dignity. frankincense if the number of dependents harvest-feast, it becomes increasingly difficult to finance their pension out of the income of working(a) population. It has been assumed that in the undermentioned 3 decades the old age dependency ration will increase from 0.25 to 0.40 in the Nordic countries. The dependency ratios over the next 40 years in three Nordic countries is shown in the graph below Source (Kvist & Greve, 2011) Thus it is clear from the above figures that it will be unsustainable for Nordic countries to provide pension to their elderly without significantly deteriorating their finances. It is assumed that Denmark will suffer deterioration of finances up to 4% of gross domestic product it will be 6% of GDP for Norway and up to 4.5% of GDP for Sweden (Kvist & Greve, 2011). Clearly no country can suffer such an impact on its finances. It is oftentimes said that the problems of a welfare state can be circumvented by ensuring a high GDP growth. The Nordic countries should focus on increasing their GDP growth rate to mop up wasted finances for their welfare schemes. In this section I will discuss the challenges of achieving high GDP growth for Nordic countries in this geological era of recession and globalisation. The Nordic countries experience historically seen higher growth rates as compared to other European economies. However...This essay examines, whether the Nordic welfare model is sustainable in these difficult economic times and the age of globalization. The Nordic welfare model is also called as the Nordic social democracy. The Nordic countries have been rigorously pro trade and suspicious of any kind of protectionism but at the same time they have made policies which ensure a large degree of equality and welfare of the children, unemployed, sick and the old. However, as it is shown in the essay, the Nordic model is increasingly become unsustainable due to pressures of an ageing population, globalization, immigration and the financial crisis which has engulfed the whole world.All Nordic countries provide generous pension facilities to enable the old to live a life of dignity. Thus if the number of dependents increase, it becomes increasingly difficult to finance their pension out of the income of working population. It has been assumed that in the next 3 decades the old age dependency ration will increase from 0.25 to 0.40 in the Nordic countries.It is often said that the problems of a welfare state c an be circumvented by ensuring a high GDP growth. The Nordic countries should focus on increasing their GDP growth rate to mop up extra finances for their welfare schemes. In this section I will discuss the challenges of achieving high GDP growth for Nordic countries in this era of recession and globalisation. The problem for these open and free economies has been attracting investment in this mood of recession