Dynamics of Policy and Politics: Politics of Unemployment in Sweden during the Interwar Period

Inspired by the theoretical perspective that “new policies create a new politics,” this paper explores how unemployment policies affected the politics of tripartite relations in Sweden during the interwar period. After the economic depression of 1920, strike activities began to decrease. Our panel data analysis finds that after 1920, the strength of the relationship between unemployment and strike activities decreased substantially. Historical interpretations complement statistical analysis.

In the 1920s, the implementation of unemployment policies entailed the following feedback effects: First, the state reinforced its capacities, gaining increasingly firm control over strike activities. Second, the union movement was plunged into internal conflicts. In contrast to the arguments of power resources theory and the theory of cross-class coalition, neither the empowerment of the Social Democratic Workers’ Party (SAP) nor employers’ lockouts induced the Confederation of Labor Unions (LO) to turn towards concertation. Rather, this turnaround occurred in the 1920s while LO coped with the feedback effects engendered endogenously in processes of the implementation of unemployment policies.