From Welfare to Work in Denmark: an alternative to free market policies?

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English: The Labour government’s ‘Welfare to Work’ strategy has been met with criticism on two grounds; the first relates to its free market orientation which is unlikely to reduce labour market inequalities. The second is its capacity to deliver given a stringent macro monetary policy and tight public expenditure constraints which will slow down economic growth and labour demand. In contrast with the UK, Denmark implemented a major reform of its welfare and labour market system in 1994, which essentially retains major elements of the Nordic model. The purpose of this article is to assess critically the development and implementation of the Danish labour market reform programme and consider its relevance for the UK. The article argues that Denmark offers a ‘working alternative’ to free market and neo-liberal policies. As the welfare and labour market reforms are geared towards building a skill base, increasing democracy and accountability and reducing inequality, there are important lessons and guiding principles for the UK.

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