Case | HBS Case Collection | March 2009 (Revised June 2012)

Denmark: Globalization and the Welfare State

by Arthur A. Daemmrich and Benjamin Kramarz

Abstract

This case describes how Denmark has balanced the impacts of globalization, including outsourcing and movement of labor, with its social welfare offerings. Reforms implemented during the past two decades drove down unemployment, promoted new company formation, and put the country at or near the top of international polls on the ease of doing business. The case describes how Danes forged a consensus that embraced international trade and outsourcing while supporting continuous upgrading of workplace skills. In April 2009, the new Prime Minister, Lars Løkke Rasmussen, is balancing short-term responses to a global recession against longer-term planning for the Danish labor market and macroeconomy. Can Denmark keep its borders open to the free movement of goods, services, and labor while also sustaining the breadth of its welfare offerings?

Keywords: Macroeconomics; Trade; Globalized Economies and Regions; Governing Rules, Regulations, and Reforms; Job Cuts and Outsourcing; Employment; Welfare or Wellbeing; Denmark;

Citation:

Daemmrich, Arthur A., and Benjamin Kramarz. "Denmark: Globalization and the Welfare State." Harvard Business School Case 709-015, March 2009. (Revised June 2012.)