STOCKHOLM — Sweden's economic and social system, sometimes called the "Swedish Model," is often depicted either as an ideal or an abnormality. But Sweden's system has varied considerably. In fact, broadly speaking there have been three different Swedish "models" since the late 19th century.
The first model lasted from about 1870 until the 1960s. During this "liberal" period, the government basically provided stable market-supporting legislation, education, health care and infrastructure. As late as 1960, both total government spending (as a share of GDP) and the distribution of earnings were similar to those prevailing in the United States.
During this century-long period, Sweden moved from being one of the poorest Western countries to being the third-richest country in terms of GDP per capita. In other words, Sweden became a rich country before its highly generous welfare-state arrangements were created.