Conclusion

In this paper I looked at Sweden’s economic performance since the start of 1990’s. During this period of over two decades this Scandinavian country has faced two crises. I was interested in finding out whether the experience and lessons gained after the crisis of 90’s played a major role in defeating the Great Recession and recovering from it much quicker than other countries did. I analysed the effects of crises and the policies and actions, implemented by the government and central bank Riksbank to resolve the situation and ensure stability.

Sweden is currently one of the best-performing countries in the world. Having recovered from the recent crisis so quickly, while so many other countries, especially in Europe, are still struggling, raises a question – How did they manage to do that? In my report I found out that the through experience, which Sweden gained during the crisis in the 90’s, the actions taken to recover and to prevent it from happening again were indeed the key factors of Sweden’s capability to recover so quickly. Government was able to respond immediately, to solidify at most important and complicated periods. Banks, which were in financial trouble, were forced to disclose their books and financial information to the authorities and that also strengthened credibility of government and Riksbank in eyes of society. In addition, the policy was aimed at saving banks not their owners. This was the key point which made the banks to operate more prudently in future. Last, Riksbank switched from pegged exchange rate to floating. As a result of this policy Sweden increased its competitiveness and managed a boost of GDP.

The lessons learnt during the crisis of 90 have played a major role in quick recovery from the Great Recession.

References

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CITATION Per08 \l 1033 : , (Westerlund, 2008),

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CITATION Lar091 \l 1033 : , (Jonung, 2009),

CITATION Eur121 \l 1033 : , (Eurostat, Real GDP growth rate - volume, 2012),

CITATION The12 \l 1033 : , (The World Bank),

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CITATION Eur12 \l 1033 : , (Eurostat, General government deficit/surplus, 2012),

CITATION Eur122 \l 1033 : , (Eurostat, Social benefits, 2012),

CITATION Rik122 \l 1033 : , (Riksbank, Key Interes Rate, 2012),

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Appendix 2: