Institutional Choices and Labor Market Policy

Abstract

Focusing on employment exchange systems, the authors explain how early labor market institutions established by British and Swedish governments affected the possibilities for subsequent policy. They demonstrate how the way in which labor exchanges were implemented in Britain and Sweden limited and facilitated, respectively, active labor market policy after 1945. The absence of institutional legitimacy in the legacy of the British labor exchange system contrasts with the legitimacy achieved by the Swedish system. The authors identify the reasons for this comparative pattern and analyze its significance.