State–Society Relationships, Social Trust and the Development of Labour Market Policies in Italy and Sweden

Abstract

The first decade of the twenty-first century may be remembered for the rebirth of consensus on labour market policy. After three decades of bitter political and ideological controversy between a neo-liberal and a traditional social democratic approach, a new model, often labelled flexicurity, has emerged. This model is promoted by numerous political organisations since it promises to put an end to the old trade-off between equality and efficiency. Several countries are embracing the flexicurity model as a blueprint for labour market reform, but others, mostly belonging to the ‘Mediterranean Rim’, are clearly lagging behind. Why is it so difficult for these countries to implement the flexicurity model? This paper argues that the application of a flexicurity strategy in these countries is complicated by the lack of social trust between social partners and the state as well as political economy traditions that highlight the role of labour market regulation as a source of social protection.