Norway - country profile

Norway most inclusive country

What does the most inclusive country do differently?

Since the inception of the World Economic Development Forum's Inclusive Development Index two years ago, Norway has consistently topped the overall rankings. This year (2018), it is followed by Luxembourg and Iceland. Characteristically, all three are very small European countries by population sizes. They are culturally not very diverse. Norway and Luxembourg have international influence disproportional to their population sizes. In my personal opinion, this might be due to their high levels of inclusiveness, giving the majority of their population opportunities for sharing and contribution to economic growth.

Norway seems to have mastered a prolonged period of economic downturn and restructuring well without loosing its top-level position on the inclusiveness scale. How does Norway achieve such high level of inclusiveness?


Norway's resources benefit all

A high GDP per capital certainly helps. However, as the recent WEF report stresses, its not sufficient on its own for achieving inclusiveness. Norway's rich oil and gas resources are managed by the world's largest sovereign wealth fund which consistently directs its income to fund areas that benefit its population as a whole. Even before an oil-price slump induced downturn of the economy, Norway has reduced its own economy's dependency on oil and gas revenues. It is interesting to note that while it exports vast amounts of oil and gas, 98% of its own energy consumption is produced by renewal energy sources.


A wider definition of employment

On the WEF's employment index measuring accessibility and stability of employment as well as pay, Norway again ranks top. There is no national minimum pay but a high percentage of the workforce belongs to unions.


Education, education, education

Access and quality of education also contributes to inclusiveness. In its country study, economist Gemma Corrigan of the WEF noted the government's effort to diversify its economy through promoting Science, Technology, Engineering and Mathematics subjects, along with vocational and entrepreneurial skills. It introduced a five-year Masters course for the supply of highly qualified teachers. Research capacity of universities and research institutes has increased due to merging of institutions.


Innovation and diversification

Various R&D funds and tax-credit schemes are available for businesses to encourage research and development aimed also at benefiting society. Entrepreneurship is actively encouraged through government support of access to funding. Public funding and funding schemes are widely available.


Closing the gap

While not top-ranked, Norway has one of the smallest gender-gaps in terms of access to education, labour force and income. It imposed a gender quota on board-level, subsidises and legalised access to child-care. At kindergarten level, high-quality education already starts with the requirement for specific subjects to be taught. Parental leave is enforced for new parents.


Not just for now

In its country report, the OECD notes that unlike many countries, Norway manages its funds with future generations in mind. Norway's fiscal rules imply ...” an intergenerationally fair use of oil wealth because spending the real returns implies leaving the real value of the Fund intact for future generations”.

Maintenance and improving infrastructure has always been a challenge in a mountainousness country with sparsely populated areas. According to the OECD, Norway has long and heavily invested into its infrastructure. If not directly, this has certainly indirectly contributed to provide broad-based access to markets.


What can we plant elsewhere?

Undoubtedly, Norway's costs of living and tax burdens are high. Broadening inclusiveness through government initiatives such as mentioned above costs tax-payer's money. Thus Norway's challenges are in part due to putting a high value on inclusiveness while having to manage the effectiveness of its state-funded programmes and reforms, fluctuating economic conditions and uncertainty, diversification of its economy and ensuring international competitiveness of its businesses despite high wages, stringent labour laws and tax-burdens.

Certainly no country is the same. Policies that have been successful to achieve a high level of inclusiveness could not be copied for the use in another country. However, its focus on managing structures and institutions of the country for the benefit of the people and the future generations serves as a working model that other countries can follow.



World Economic Forum, “The Inclusive Development Index 2018 Summary and Data Highlights”

OECD Economic Surveys, Norway,January 2018


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