THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Sweden

Ranked 8th of 149

At a glance

Ranks

8 th on the Legatum
Prosperity Index™

3rd
13th
5th
13th
6th
10th
14th
18th
9th

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Sweden performs best on Economic Quality and Governance and scores lowest on the Social Capital sub-index.

Visit our Rankings table to see how Sweden compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Sweden enjoys the world’s 8th largest prosperity surplus. Although an impressive achievement, this surplus has narrowed since 2012 when the country had the 2nd largest prosperity surplus in the world after New Zealand. It has since then been overtaken by its Nordic neighbours Denmark and Finland.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

Ranked in the top 15 in eight out of nine sub-indices, Sweden has been a symbol of prosperity for the last decade. Yet once ranked 1st in the world for prosperity between 2010 and 2012, Sweden now lies 8th and has slipped rank in five sub-indices since 2007.

Sweden has seen its pattern of prosperity change over the last decade as some sub-indices fall while others rise. The biggest increase can be observed in Natural Environment and the largest decline in Education.
Sweden has seen its pattern of prosperity change over the last decade as some sub-indices fall while others rise. The biggest increase can be observed in Natural Environment and the largest decline in Education.

That prosperity has fallen is surprising given that Sweden is one of the few countries where GDP per capita has recovered swiftly from the 2008 crisis to now surpass pre-crash levels. This can be attributed to a decline in the country’s prosperity surplus over the last five years, meaning that the country is delivering less prosperity with its wealth than it previously has been.

Nevertheless, Sweden remains a very prosperous nation. Sweden has the fifth best governance system in the world. It is the third least corrupt country globally, has strong rule of law, and has continuously achieved the highest possible scores for democracy levels and political rights over the last ten years. Sweden’s Economic Quality sub-index is third in the world, which could explain why Sweden was marginally affected by the crisis compared to other countries. In many ways, it has grown a better place to live with positive changes seen in health, crime rates, and the environment.

Sweden has the sixth best health system despite sharing the challenges of rising obesity with other developed peers. This has largely been a result of rising satisfaction amongst Swedes with their personal health and local healthcare system. The nation also has the 10th highest life expectancy at birth in the world. Homicide and theft rates have fallen quite markedly since 2007, with a 22% and 31% decline in each respectively. However, the increasing threat from terrorism is exerting pressure on the Safety & Security sub-index, where Sweden is struggling to maintain its place in the top ten. The Stockholm bombings saw Sweden fall in this sub-index in 2010 from 11th to 15th. Over the last ten years, Sweden has risen four ranks to ninth in the Natural Environment sub-index. Almost 70% of respondents are satisfied with efforts to preserve the environment in Sweden. This is heightened by the fact that 93.2% of wastewater is treated which is the 12th highest rate in the world.

Despite all these achievements, Sweden’s prosperity ranking has fallen. Much of the decline is attributable not only to stagnating GDP growth rates but also to the Education and Personal Freedom sub-indices. Sweden’s Personal Freedom rank has dropped sharply from 4th in 2010 to 14th in 2016. Despite a 93% satisfaction with freedom amongst the population, this rate lags behind that of its Nordic peers Finland, Norway, Iceland, and Denmark. This is partly due to the country’s marked increase in social and governmental religious restrictions. However, it is not necessarily that Sweden’s freedom score has deteriorated drastically per se, but rather that other countries have leap frogged it. Once a pioneer in LGBT rights and one of the first to legalise same sex marriage in 2009, Sweden no longer holds this as an advantage as many countries have followed its example.

Sweden’s once widely acclaimed education model is slowly losing credibility, as it now falls outside the top ten in the Education sub-index. Most evident has been an increase in inequality in education outcomes and a worsening girl to boy education ratio.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.

Special Analysis

Special Analysis

OVERALL

Sweden has become less prosperous since 2012, having dropped from 1st place to 8th in 2016. It does however remain among the most prosperous countries in the world thanks to strong and stable healthcare, governance, and economic quality.

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Areas of Success
Areas of Success

Economic Quality is Sweden’s strongest asset, ranking 3rd in 2016, and consistently in the top five in the last decade. Sweden has the 3rd highest labour force participation rate in Europe and its share of the population with a bank account is in the global top five. Governance is a close and consistent second, ranking 5th in 2016. Here rule of law has been strengthened and perceptions of corruption are in the global top ten. Improvements have occurred in the health sub-index where Sweden has climbed from 8th to 6th over the last ten years. This is predominantly a result of rising life expectancy and satisfaction with health and healthcare among the population.

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Areas of Little Change
Areas of Little Change

Little movement had been recorded by the Index in in Sweden’s Social Capital performance. This is despite improvements in the underlying score in this sub-index. This is predominantly a result of a number of peers matching and exceeding much of the progress made by Sweden in this sub-index, notably in the form of involvement in charitable activities and opportunities to make friends.

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Areas of Improvement
Areas of Improvement

Most concerning for Sweden, predominantly a knowledge economy, is that absolute decline has come in the key foundation for successful human development and sustained prosperity growth. In the Education sub-index, Sweden has fallen from 6th to 13th in the past decade. This is a result of declining education equality- notably regarding girls to boys enrolment ratio in primary school.