Juha Peralampi

The Nordic Welfare Model-opportunity or threat for entrepreneurship?

“Building the Entrepreneurial University” at Stanford University 12-16 November 2012 by Mr.

Juha Perälampi, Manager of JAMK Business Incubator

11.04.23 1

• Free education from Kindergarten through University– Includes free meals, school materials, books, pencils,

paper, counseling, etc.

– University students are PAID to study including housing

• Unemployment benefits between 50-80% of your income

• Pension 60 % of your income

What do you get for your tax dollar?

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• Free pediatric care • 50 dollars a year covers all healthcare

for adults• Medications• Maternity leave 75 % of your income

level up to 9 months• Monthly stipend for each child

What do you get for your tax dollar?



The nordic countries

• Common history• High income level• Equality principle• The Nordic

Welfare Model

• Globalization (outsourcing)• EU Crisis• Demographic transition

”Collective risk sharing should continue to offer a safety net which helps workers and their families to cope with risks and adapt to new circumstances”

challenges


• The Best Country in the World: Newsweek• The Most Successful Nation: The Fund for peace

report • 2nd Happiest Nation: United Nation's World

Happiness Report • 3rd Most Competitive Economy: The Global

Competitiveness Report

Finland in perspective


photo courtesy of FreeDigitalPhotos.net

• Income tax: max 50 % + social costs 6 %

• Significant deductions for home owners and underprivilidged

• Capital gains tax: 30%

• Corporate tax: 26%

• Sales tax: 23%

• Dont get pulled over! Speeding tickets may be priced according to your income!

Tax burden


• The major ecocomic and political processes paved the way for Finland’s high-tech industries and educational reform

1. The turmoil in the Soviet Union 19912. A deep and severe economic recession triggered by a

Finnish banking crisis (1990-1993), unemployment hit 20%,

3. Integration with the European Union (1992-1995), membership 1995

4. Eurozone Crisis 2009-

A knowledge-based economy

Esityksen nimi, Tekijä 11.04.23 8

Opportunities and threats for entrepreneurship

Education


• The main transformer of social and economic development since the 1940’s

• The Finnish education system rated as one of the best

• Equal educational opportunity for all

• Almost all teachers have a Master’s degree

• Teaching is a high-status profession

Education #1


• Education leads the way to employment, not entrepreneurship?

• Are you allowed to stand out and shine?

• Is this equality principle the right soil

high-growth entrepreneurship?

Education #2


photo courtesy of FreeDigitalPhotos.net

”For about two decades building a succesful venture capital (VC) industry has been among the central policy objectives in Finland. However, with its high-guality, white- and blue-collar human capital, but small internal market and limited VC industry, ”nice-growth” firms might better fit Finland’s profile of unique advantages and social values.”

- Professor Martin Kenney, University of California, Davis

”NICE-GROWTH”



Economy


• Very industrialized economy, based

mainly on the free market

• Nokia and Rovio Entertainment

• Significant investments done in R&D (ranked 3rd in the world)

• Investing in education and innovation during recessions

Finland strong Points


• A limited domestic market • Relies heavily on exports

(40% of the GNP)• In Finland, it is acceptable to become

rich by winning the lottery or being an athlete, NOT by employment nor being an entrepreneur

finland Weak Points



Mindset


• Diplomacy and seeking consensus• Problem-solving and efficiency• Accountability and honesty• Sisu=determination and

strength of will

Mindset #1


• ”The Finnish Dream”• Older generation has laid the

very foundations of the success story, hard to ”let go” and understand that foundations need to be changed

Mindset #2


“During the next 10 years about 1.2 billion young 15-to-30-year-olds will be entering the job market. With the means now at our disposal, about 300 million will get a job. What will we offer these young, about a billion of them? I think this is one of the greatest challenges if we want to achieve peaceful development and hope for these young.”

- Mr. Martti Ahtisaari (former President of Finland (1994-2000) and Nobel Peace Prize winner 2008)

Enrepreneurship creates jobs and calls for global cooperation


Thank you!Questions and comments?


Mr. Juha PerälampiManager, JAMK-Business IncubatorSenior Lecturer,

International Business and Entrepreneurshiptel. +358 (0)41-534 3603 Email: [email protected]

JAMK University of Applied SciencesRajakatu 35, FI-40200 Jyväskylä, Finland

Contact information


• Finnish Lessons-Pasi Sahlberg at http://www.finnishlessons.com/

• The Nordic Welfare Model- Embracing globalization and sharing risks at http://www.etla.fi/julkaisut/b232-fi

• http://en.wikipedia.org/wiki/Nordic_countries

• http://www.google.fi/imgres?q=nordic+countries&um=1&hl=fi&sa=N&biw=1920&bih=986&tbm=isch&tbnid=WXpnGVQ4ffwWpM:&imgrefurl=http://www.corbacho.info/finlandia/2009/07/finlandia-suomi-laponia-vikingos-paises-nordic-escandinavia/&docid=S511wgEZ0bvv_M&imgurl=http://www.corbacho.info/finlandia/wp-content/uploads/2009/07/nordic-countries-500x424.png&w=500&h=424&ei=UVnHT83TEajV4QTistWyDg&zoom=1

• http://www.emeraldinsight.com/journals.htm?issn=1756-6266&volume=3&issue=2&articleid=1937351&show=html&view=printarticle&nolog=258380

• http://www.svrez.gov.si/fileadmin/svez.gov.si/pageuploads/docs/Strategija_razvoja_Slovenije/The_Nordic_Model.PDF

• http://en.wikipedia.org/wiki/Nordic_model

• http://www.taxrates.cc/html/us-tax-rates.html

• http://www.weforum.org/issues/global-competitiveness

• http://www.fundforpeace.org/global/?q=fsi-about

• http://www.huffingtonpost.com/2012/04/06/world-happiness-report-2012_n_1408787.html

• http://www.thedailybeast.com/newsweek/galleries/2010/08/15/best-countries-in-the-world.html#slide91

• http://www.globaltrade.net/m/c/Finland.html

• http://www.tem.fi/files/32926/TEMjul_20_2012_web.pdf

• http://en.wikipedia.org/wiki/File:Europe_polar_stereographic_Caucasus_Urals_boundary.svg

Sources / Links


• http://blog.nolo.com/estateplanning/tag/gift-tax/

• http://www.careerrocketeer.com/2012/04/attention-are-you-retraining-your-mindset-for-career-success.html

• http://www.posti.fi/english/current/2008/20081022_ahtisaari.html

• http://www.smbtraining.com/blog/less-is-more-usually

• http://npoliticsf.wordpress.com/2012/05/21/what-is-happening-in-education/

• http://www.freedigitalphotos.net

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Juha Peralampi

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