How Have Narratives, Beliefs and Practices Shaped Pension Reform in Sweden?

Abstract

This chapter investigates how institutional narratives, beliefs and practices have shaped pension reform processes in Sweden. The chapter adopts a bottom-up perspective, analysing the development of pension policy in two major reform episodes, the 1959 ATP reform and the 1994/98 reform of that system. The chapter shows how important pension reform struggles in the past shaped policy-makers’ beliefs and shared institutional narratives concerning the appropriate design and role of the pension system. The failure of collective bargaining to produce supplementary pension coverage for blue-collar workers in the two decades prior to the 1959 ATP reform generated grass-roots pressure for union leaders and eventually, the Social Democratic Party, to pursue a legislative solution. The emergence of widespread belief in the virtues of expertise-based socio-economic planning intersected with growing Social Democratic influence in politics to create a centre-left world view that saw major pension reform as desirable, achievable and just. In the 1990s, the intense political conflict associated with the 1959 ATP pension reform helped to generate a shared narrative in which political conflict was to be avoided at all cost in negotiating the parameters of a reformed pension system in the 1990s.