Assessing SAP's Economic Policy in the 1980s: The 'Third Way', the Swedish Model and the Transition from Fordism to Post-Fordism

Abstract

This paper applies a historical structural, regulation-theoretical approach to interpret Swedish economic policy in the 1980s. It is argued that the market-oriented long-term assumptions of the 'third way' were flawed, and constituted an inadequate response to the crisis of the Swedish (Rehn-Meidner) Model. It violated the already increasingly brittle terms of legitimation of the 'moral economy' of solidaristic wage policy. Although such a violation was reasonable, necessary (and accepted by the trade unions) in the short run, the failure of the policy to achieve a progressive trajectory in the transformation from Fordism to post-Fordism made it impossible to reproduce the conditions of the 'moral economy'. The paper is especially critical of the use of a 'norms-based' monetary policy, and the marginalization of collective capital formation policy and active industrial policy.