renewable energy scandinavia

Why is Scandinavian Economy so Rich?

Probably many people have ever wondered why the Scandinavian states are so rich.

Sweden, Norway, Finland, Denmark and Iceland together enjoy a very high standard of living.

This fact surprises many people from all around the world and makes them wonder “why”.

The causes of the Scandinavia‘s states wealth are numerous and complex.

These reasons cannot be described in a few sentences.

However, we tried to offer the most important of them:

1st reason:

renewable energy scandinavia
One of the hallmarks of the Nordic countries is the combination of large area and small number of people living there.

In Scandinavia are some of the larger European countries that are also among the countries with the lowest population density in the world.

The considerable wealth of these countries is easily distributable among the sparse population.

This means that the population has very high GDP (gross domestic product) per capita.

For these countries is relatively easy to satisfy their own needs and at the same time to export high quality goods and services.

2nd reason:

The Scandinavian countries have a favorable economic occupation.

Their neighbors are large and highly developed countries (Germany for example).

These countries are bordered by the Atlantic and Arctic Oceans, North and Baltic Seas.

These waters are extremely rich in fish and in many places, especially along the coast of Norway, there are significant deposits of oil.

The long coastline favors the development of water transport.

Not accidentally for centuries the Scandinavians have always been known as exceptional sailors.

3rd reason:

sweden market
The Scandinavian countries are specialized in the production of a given product or service, occupying a specific market niche in the world.

Norway is a global manufacturer of oil that is extracted from the bottom of the North Sea.

Sweden is known for its high quality steel, paper and automobiles and Finland is one of the world’s leading manufacturers of mobile phones.

Despite its small territory, Denmark is among the leading food producers in, as well as one of the world leaders in the production of renewable energy.

Iceland is famous for the export of fish and fishery products from the rich Arctic waters.

4th reason:

Sweden, Norway, Finland, Denmark and Iceland are countries with cold and dark climate.

Because of this reason the lifestyle is absolutely different in comparison with the summer holiday atmosphere which prevails in South Europe.

In most of the year the weather conditions in the Nordic countries are too unfavorable.

This causes people to find indoor activities, to indulge in work, learning and other forms of self-perfection in order to go faster through the freezing and depressing winter months.

The cold climate has built a completely different habits in the Nordic people.

In the Mediterranean countries, because of the hot and lazy weather during the summer season people spend a lot of time outdoors.

This leads to more time for socializing and less time for working and learning.

The sun makes people seek entertainment.

The unbearable summer heat, especially in July and August, makes people almost unable to work.

5th reason:

To a large extent the wealth of the Scandinavians is a result of financial and tax policy.

Nobody can deny that it is important not only how exactly developed is the country, but also what kind of wealth distribution policy is being held.

In the modern western societies and states, of course, the role of countries in the income redistribution is relatively small.

As a whole the government intervention is considered to be very unfair and unpopular.

To a large extent the government intervention into the economy is limited to the imposition of taxes.

That is the main lever, which has made countries like Sweden, Norway, Finland, Denmark and Iceland so successful.

Taxes in the Nordic countries are very high.

Most benefited of this social policy are poor, elderly, unemployed, young and still vulnerable people (e.g. students) and low-income people.

The wealthy residents of the Nordic countries are not particularly happy with the fact that they have to be separated by significant part of their incomes.

Besides the fact that Scandinavia assists people with lower incomes, it invests also large sums of money in science, health and development of high technology, which guarantees future success of the region.

When the state on one hand takes care of people to be healthy, educated and confident in their future, they on the other hand make it up by developing the full potential of their capabilities, regardless of what they can do.

Thus, generally speaking, the Nordic countries form strong nations consisted of ambitious, confident and calm people and this is probably the biggest wealth of these countries.

6th reason:

denmark lifestyle
Sweden, Finland and Denmark are members of the European Union and Iceland is in talks to join.

Only Norway is not a member of EU but maintain very close economic relations with the community.

The EU membership and partnership is a very solid foundation for economic development of the Nordic countries.

It is encouraging for them to know that they can rely to the support of the biggest market in the world.

The European Union is a guarantee that countries will never be “hungry” for high and low skilled workers.

It is also a guarantee that goods and services producing in these countries will have a much bigger market in comparison with their own.

7th reason:

The Nordic states enjoy an outstanding order, security and peaceful way of life.

It will not be an exaggeration to say that these are the countries with the lowest crime rate in the world.

This in turn is a really good advertising and attracts numerous investors.

Scandinavia is a region where people have very high confidence in the judiciary and police, which is a very good basis for development of stable society.

Perhaps this is the right place to mention that in the Nordic countries alcohol consumption is quite limited due to the highly inflated prices.

This fact with certainly has its positive impact on crime.

8th reason:

Equal treatment is also among the leading causes that put Scandinavia on top of the world’s wealth and quality of life.

And this is not only a question of ethnic and religious equality. It comes also to gender equality.

Sweden is known as the country in the world where women rights are most respected.

Iceland on the other hand is first in the world according to important state positions in the country, occupied by women.

The equality between men and women causes very positive impact on the economy.

Because of this reason the population in the Nordic countries is more functional economically.

There are probably hundreds of other reasons besides these for the welfare and prosperity of the Nordic countries.

Some factors are more important compared to others, but one thing with certainly is a fact – Sweden, Norway, Finland, Denmark and Iceland are among the richest countries.

And while other states from all around the world face more and more ruthless and serious global competition, the Nordic states become richer and year after year increase their international influence, turning Scandinavia into one of the most significant figures in the global economy.