2017 Index of Economic Freedom

Sweden

overall score74.9
world rank19
Rule of Law

Property Rights88.6

Government Integrity87.4

Judicial Effectiveness82.2

Government Size

Government Spending21.7

Tax Burden44.4

Fiscal Health93.4

Regulatory Efficiency

Business Freedom90.8

Labor Freedom53.2

Monetary Freedom85.3

Open Markets

Trade Freedom87.0

Investment Freedom85.0

Financial Freedom80.0

Embed This Data

Create a Comparison Chart

See how Sweden compares to another country using any of the measures in the Index.

vs
Close
Download PDF
Quick Facts
  • Population:
    • 9.8 million
  • GDP (PPP):
    • $473.4 billion
    • 4.1% growth
    • 2.0% 5-year compound annual growth
    • $47,922 per capita
  • Unemployment:
    • 7.4%
  • Inflation (CPI):
    • 0.7%
  • FDI Inflow:
    • $12.6 billion
Embed This Data

Sweden’s economy performs notably well in regulatory efficiency, with open-market policies that sustain flexibility, competitiveness, and large flows of trade and investment. The transparent and efficient regulatory environment encourages robust entrepreneurial activity. Banking regulations are sensible, and lending practices have been prudent. The legal system provides strong protection for property rights, buttressing judicial effectiveness and government integrity.

Government spending accounts for over half of GDP, and the tax regime needed to finance the wide scope of government has become more burdensome. However, institutional assets such as high degrees of business efficiency and transparency have counterbalanced some of the shortcomings of heavy social spending.

Close

Background

Sweden joined the European Union in 1995 but rejected adoption of the euro in 2003. The public opposes membership in the eurozone. A general election was held in September 2014. After difficult negotiations, a new center-left Social Democratic Party–Green Party coalition government took office, led by Prime Minister Stefan Löfven. The government has cut spending and increased borrowing to cover the surging costs of unprecedented numbers of migrant arrivals in Sweden. Due to a number of security incidents in the region that have been linked to Russia, the debate about possible NATO membership has resurfaced, but it remains unlikely that Sweden will join the alliance in the near future.

Rule of LawView Methodology

Property Rights 88.6 Create a Graph using this measurement

Government Integrity 87.4 Create a Graph using this measurement

Judicial Effectiveness 82.2 Create a Graph using this measurement

Property rights and enforcement of contracts are very secure. The rule of law is well maintained. The judicial system operates independently, impartially, and consistently. Rates of corruption are low, and Sweden was ranked third out of 168 countries and territories surveyed in Transparency International’s 2015 Corruption Perceptions Index. Effective anticorruption measures discourage bribery of public officials and uphold government integrity.

Government SizeView Methodology

The top personal income tax rate is 57 percent, and the top corporate tax rate is 22 percent. Other taxes include a value-added tax and a capital gains tax. The overall tax burden equals 42.7 percent of total domestic income. Government spending has amounted to 51.1 percent of total output (GDP) over the past three years, and budget deficits have averaged 1.3 percent of GDP. Public debt is equivalent to 44.1 percent of GDP.

Regulatory EfficiencyView Methodology

The efficient regulatory framework strongly facilitates entrepreneurial activity, allowing business formation and operation to be dynamic and innovative. The nonsalary cost of employing a worker is high, and dismissing an employee is costly and burdensome. There are few price controls, but state-owned liquor stores set prices for alcohol. The northern part of the country receives agriculture subsidies from the EU.

Open MarketsView Methodology

Trade is important to Sweden’s economy; the value of exports and imports taken together equals 86 percent of GDP. The average applied tariff rate is 1.5 percent. Sweden is relatively open to foreign investment, but numerous state-owned enterprises distort the economy. Regulation of the financial system is transparent and largely consistent with international norms. Banks offer a full range of financial services.

Country's Score Over Time

View Chart of Scores over Time

Regional Ranking

rank country overall change
1Switzerland81.50.5
2Estonia79.11.9
3Ireland76.7-0.6
4United Kingdom76.40.0
5Georgia763.4
6Luxembourg75.92.0
7The Netherlands75.81.2
8Lithuania75.80.6
9Denmark75.1-0.2
10Sweden74.92.9
11Latvia74.84.4
12Iceland74.41.1
13Finland741.4
14Norway743.2
15Germany73.8-0.6
16Czech Republic73.30.1
17Austria72.30.6
18Macedonia70.73.2
19Armenia70.33.3
20Romania69.74.1
21Poland68.3-1.0
22Kosovo67.96.5
23Bulgaria67.92.0
24Cyprus67.9-0.8
25Belgium67.8-0.6
26Malta67.71.0
27Hungary 65.8-0.2
28Slovakia65.7-0.9
29Turkey65.23.1
30Albania64.4-1.5
31Spain63.6-4.9
32France63.31.0
33Portugal62.6-2.5
34Italy62.51.3
35Montenegro62-2.9
36Bosnia and Herzegovina60.21.6
37Croatia59.40.3
38Slovenia59.2-1.4
39Serbia 58.9-3.2
40Belarus58.69.8
41Moldova580.6
42Russia57.16.5
43Greece551.8
44Ukraine48.11.3
See Entire Region List ›

View all countries ›

Back to Top