Allan´s Weblog

The OECD has just released it´s annual survey of Danish economy.

We are generally given good grades. Reading the survey give you the impression that we´re pretty rich in Denmark.

The Danish economy is performing very well, reaping the benefits of 25 years of well-managed economic reform. In 2005 growth picked up to 3%. Even though unemployment has declined to a historical low, inflation remains subdued and there are no signs yet of accelerating wages. The output gap has closed and growth is projected to stay above potential in the short term, with almost only the automatic fiscal stabilizers in place to slow a potentially overheating economy. Looking further ahead, a significant downward trend in labour supply is looming that will tend to reduce the potential growth rate. In the longer term, a declining workforce and ageing-related expenditure increases make the current public welfare system difficult to sustain. Although labour force participation is high, the number of hours worked is low, not least because of high marginal taxes. One area where reforms have not yet made enough progress is housing, which is overregulated and absorbs too many subsidies and tax expenditures.

In spite of the fact that most economical factors in Denmark look quite good, I would like to give you another view on things. I am not the OECD, but I am the man in the street - therefore having an alternative and, dare I say, more relevant view on things.

I know poor people! When reading these nice economical figures, you could be lead to the misassumption that every one in Denmark is very well off. That´s not the case!

These figures are statistical averages. It´s just like saying that a person sitting with his feet in a freezer and the head in the oven is feeling very comfortable - in average. Dosen´t make sense!

As said, I know poor people. People that whenever they experience toothache will have to hope that it passes by itself. People who can´t afford to have a birthday party for their kids. People that by the 20th every month will have spend their whole salary - and will have to make "magic" for the rest of the month in order to get something to eat.

The difference between rich and poor in Denmark increases these years. I just think it´s vital to mention this - as part of the total impression given of my country.

The rest of the OECD survey can be read here.