The economy in the Nordic Region (2024)

FAQs

The economy in the Nordic Region? ›

The Nordic model is characterised by stable inflation and exchange rates, a large public sector, many welfare benefits and a social safety net that embraces everybody. Taxes are among the highest in the world.

The Nordic model refers to the standards followed in Sweden, Norway, Finland, Denmark, and Iceland. These nations are known for high living standards and low-income disparity. The Nordic model merges free-market capitalism with a generous welfare system.

From a macroregional perspective, the Nordic countries form a coherent region, performing well above EU and OECD averages. However, the are some internal differences: While Sweden has the highest gross domestic product (GDP) overall, Norway has the highest GDP per capita.

The Nordics, with a total population of 27 million people and GDP of 1366 billion, not only rank on the happiest countries listing. Their economies are steady and growing.

Finland, Norway and Sweden had large forest resources, and, thus, timber and pulp and paper have been important export products. Sweden also has significant iron ore reserves, which brought wealth to the country even prior to modern industrialisation.

The three distinct but interrelated features of the Nordic model are a high degree of compression of wage differentials, a dynamic process of creative destruction and innovation, and a high level of public welfare spending.

Of the Nordic countries, Sweden has had the highest at-risk-of-poverty rate from 2011 to 2020. In 2020, 16 percent of Sweden's population lived at risk of poverty. Since 2015, Norway, Denmark, and Finland all have similar at-risk-of-poverty rates, around 12 percent in 2020.

Oil, gas, seafood, and products from energy-intensive industry are among our main export commodities. Our sea areas are six times the size of our land area, and our ocean-based industries account for almost 40 % of our total value creation, and 70 % of our exports.

Norway's economy is considered “mostly free” according to the 2024 Index. The diversified and modern Norwegian economy benefits from high levels of flexibility and institutional strengths that include strong protection of property rights and an efficient legal framework.

Average earnings in Iceland were nearly 50,000 euros annually. Meanwhile, Sweden and Finland had the lowest average earnings in the region with 35,000 and 33,000 euros annually, respectively.

Are Nordic countries productive? ›

Norway has won bragging rights as the second-most productive country in the world. And Iceland, Norway, Sweden, and Finland are ranked in the top four, respectively, for most gender-equal countries.

However, after the fall of the oil price in 2014, Norway's GDP per capita decreased, but is still the highest in the region, and it increased to over 105,000 U.S. dollars in 2022. Moreover, while Iceland had the lowest GDP per capita together with Finland in 2015, it had the second highest in 2023 ahead of Denmark.

Today, 6% of the Nordic region's economy is circular—meaning that ~6% of resources used for production come from recovered materials. By comparison, the EU average is at ~12% circularity, with an ambition to double the rate by 2030.

The Nordic model is underpinned by a mixed-market capitalist economic system that features high degrees of private ownership, with the exception of Norway which includes a large number of state-owned enterprises and state ownership in publicly listed firms.

Sweden - with a population of just 10 million - also has one of the world's highest proportions of "dollar billionaires" per capita.

Scandinavian countries provide a broader scope of public services—such as universal health care and higher education—than the United States. However, such programs necessitate higher levels of taxation, which is reflected in Scandinavia's relatively high tax-to-GDP ratios.

: of or relating to the Germanic peoples of northern Europe and especially of Scandinavia. 2. : of or relating to a group or physical type characterized by tall stature, long head, light skin and hair, and blue eyes.

The Viking Age saw the development of a bullion economy. In this economic framework, traders and merchants exchanged goods for bullion (precious metals, primarily gold and silver). Trade was usually accomplished by barter.

Average earnings in Iceland were nearly 50,000 euros annually. Meanwhile, Sweden and Finland had the lowest average earnings in the region with 35,000 and 33,000 euros annually, respectively. Average earnings in the Nordic countries are significantly higher than the EU average.

Emphasizing the use of natural materials, neutral colors, and clean lines to create a serene and harmonious living environment. The Nordic design philosophy places a strong emphasis on the quality of materials and craftsmanship, as well as sustainable and ethical production processes.