Growth Strategies and Welfare Reforms in Denmark
In a new chapter in the book ‘Growth Strategies and Welfare Reforms: How Nations Cope with Economic Transitions’ Christian Lyhne Ibsen and Jette Steen Knudsen analyze the development of Denmarks balanced export-led growth strategy and the role of industrial relations and social policy reforms.
This chapter analyzes the development of the balanced export-led growth strategy in Denmark and the role of industrial relations and social policy reforms. The chapter illustrates how the Danish growth strategy accommodates demands from exporting companies and labor by coupling dynamic market creation and increasing labor supply with a collectivization of risks. We identify three economic imperatives for welfare state reforms in the Danish growth strategy: (1) a highly educated workforce; (2) flexible employment relations; and (3) high labor force participation. Despite the emergence of liberalizing developments in recent years, equality and sustaining domestic demand remain key goals. Unemployment benefits continue to be generous, especially in an international context, and (continuing) education remains free and accessible to everyone “for life.” However, the chapter also raises questions about the sustainability of the Danish model in the face of significant economic restructuring challenges.
Read the full chapter ‘Growth Strategies and Welfare Reforms in Denmark’ by Christian Lyhne Ibsen and Jette Steen Knudsen. Published in the new book ‘Growth Strategies and Welfare Reforms: How Nations Cope with Economic Transitions’, Oxford University Press, August 2025.