Sunday, October 12, 2008

Sustainability of the third way







Yesterday I was talking about how German women give up their careers entirely in order to have a family and about the predominance of the men in the German business landscape.

In the last two days I've faced a totally different model, usually called in economics "the third way". Namely it is the economic model of the Scandinavian countries. This model is characterized by solidarity, an extensive social system financed through a high income taxation on level.

So is it efficient?

At the first view it seems to be as streets are clean, transportation system is very developed. What is more, what I found interesting here is the high proportion of young mothers with children. That is with 25 women already have 2 kids. Even if at the first sight this has made a strong impression on me, I found three explanations for this phenomenon.

1) The extensive social system that I was previously talking about supports young people to have children early in their adult lives.

2) There is a different mentality that I've encountered in these countries. People get together and form a couple and then a family early in their lives, but in 60% of cases these relationships end.

3) The labor market is flexible enough to offer different possibilities to work through: part time and flexible time working, teleworking or other forms of working from home.

All these encourage couples to have a family soon enough as, contrary to Romania, they don't have think of the financial challenges. The state has sufficient resources to support them in such cases.

What other explanations do you see to be plausible?

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