Erosion or renewal of the Danish Model

Article by Jesper Due & Jørgen Steen Madsen

The Danish model represents one of the most solidly based IR systems in Europe, and is to day internationally regarded as an example to be followed because of its effective combination of flexibility and security in labour-market regulation. But in an increasingly globalised world even this model has come under pressure. The pressure comes from three different directions: 1) from EU regulation, 2) from the national political system and 3) from the parties at enterprise level.

The organised or centralised decentralisation of the collective bargaining system that was the answer to the increased competitive pressure of internationalisation would appear to have reached its limit and to have been replaced by a trend towards multi-level regulation. Whether this trend will lead to renewal or erosion of the Danish model will be revealed over the next years. There are signs that indicate the model's continued robustness, but there are also signs of weakening. The outcome is not only of national interest, but also has a more international perspective, since Denmark can be seen as the IR model par excellence. As a critical case the development of the Danish model is an indicator of the traditional IR system's future prospects in general.

Article in Journal of Industrial Relations.