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Digitalization, Immigration and the Welfare State

Mårten Blix

The Swedish welfare state finds itself in the middle of two major upheavals: The impact of technology and immigration. Having taken in more refugees per capita than most other countries, the pillars of the welfare state are being shaken. Digital technologies are set to strengthen already existing trends towards job and wage polarization. This book explores how these trends are more pronounced due to the rigidity of the labor market and the comprehensiveness of tax-financed welfare services.
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Chapter 6: Immigration, inequality and skills in the digital economy

Mårten Blix


Hundreds of cars set on fire, a school in flames and angry youths hurling stones at the police. This is not the banlieue in France but suburbs in supposedly peaceful Sweden. (The Economist)1

Images of riots in Husby, a segregated suburb in northern Stockholm, in the summer of 2013 were cabled out around the world and came as a shock, not least to the Swedes themselves. Located in the suburbs of Stockholm, it drew attention to social discontent that had been brewing for some time and to communities that had become increasingly hostile to the authorities and to the police. The events were widely covered by international media trying to understand how the tranquil Nordic country of Sweden could be beset by problems that occur in other countries with more conflict or poverty. Farmers blocking the roads in Paris, demonstrations against the police in the USA following racial tensions and demonstrations against globalization. Surely, there would be no grounds for riots in a homogeneous and egalitarian country with a generous safety net for all?

Segregation and conflict have of course always existed in Sweden, but it has now increased to levels more reminiscent of countries with large social disparities. Sweden is entering a period of major change for the welfare state. The legitimacy of society’s demands on citizens in Sweden to obey rules and pay high levels of tax in exchange for security and a generous social safety net has been strong in the past....

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