According to Forbes’ 2021 list of billionaires by country, Sweden boasts a relatively high number (41) of billionaires for its small size and population.
Although they don’t even have 100 billionaires, in relation to the size and population of the country, the number they do have is impressive.
So what is it about Sweden that makes it home to so many wealthy people?
Sweden has so many billionaires because they have a history of entrepreneurship and a strong work ethic.
They also have a thriving business culture and sustainable tax and welfare systems. Additionally, they’re a peaceful country that doesn’t waste money on expensive wars.
This article will talk about how many billionaires Sweden has and how that number relates per capita to other prosperous countries globally.
It will also discuss Sweden’s wealth inequality and its tax system.
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How Many Billionaires Does Sweden Have?
As of 2021, Sweden had 41 billionaires, an increase of ten from the 31 they had in 2020. Since the United States had 724 billionaires in 2021, 41 may not seem like many.
However, compared to the small population of Sweden, 41 is very impressive.
Forbes lists 20 countries in its article “The Countries With The Most Billionaires 2021.” [1] Of those 20 countries, Sweden is one of only three on the list with less than 11 million people.
The other two are Switzerland (8.637 million and 40 billionaires) and Singapore (5.686 million and 27 billionaires).
But what exactly does that mean? How do Sweden’s 41 billionaires measure up against America’s 724?
Considering the populations of both countries, Sweden has approximately three times the number of billionaires per capita as the United States.
The following sections will outline why Sweden is such a notoriously rich country.
A Little Bit of Luck
First of all, Sweden got lucky during the Industrial Revolution. Before that time, the country was struggling a little (in the mid-19th century). [2]
However, once the Industrial Revolution picked up speed, larger countries began to rely on Sweden to supply them with the materials they needed to build and revolutionize.
The country had a wealth of iron ore and wood, and Germany and Britain needed those things. Being able to export in-demand goods greatly increased Sweden’s prosperity.
History of Entrepreneurship
Sometimes, all it takes is one lucky event – like the Industrial Revolution – to turn things around for an entire country.
Once Sweden entered the global trade market on a relatively large scale, it kept going.
The country has a long and impressive history of entrepreneurship.
Although geographically, Sweden is small, it’s home to some of the world’s most successful companies, including:
- IKEA
- Volvo
- Electrolux
- H&M
- Spotify [3]
In fact, Sweden ranks in the top 10 of the “World’s Most Entrepreneurial Countries.” [4]
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Strong Work Ethic
People in Sweden have a strong work ethic. Despite many claims that Sweden is a socialist country, it’s not.
While it does have some socialist principles and programs in place, it’s a capitalist country. (Many people refer to its capitalist system as “cuddly capitalism.”) [5]
People have to work hard for what they have, and they’re willing to do it.
Thriving Business Culture
Sweden’s thriving business culture goes hand-in-hand with its people’s strong work ethic and the country’s history of entrepreneurship.
While people may not associate Sweden with the fast-paced world of business – a la Wall Street – that world is there nonetheless, and it’s always in full force.
Sustainable Tax and Welfare Systems
Sweden has a long history of implementing sustainable tax and welfare systems. For example, in the early 1970s, Sweden introduced a wealth tax to reduce economic inequality.
Additionally, Sweden provides its citizens with high-quality social services, such as healthcare and education.
By doing so, Sweden can ensure that all of its citizens have access to these essential resources, regardless of their income level.
Ultimately, Sweden’s sustainable tax and welfare systems benefit both the individual and society.
Peaceful Country
It turns out that Sweden’s peaceful nature is good for more than just the country’s image; it also helps out financially.
In fact, Sweden consistently ranks among the most peaceful countries worldwide; it’s also regularly one of the most prosperous.
The factors contributing to Sweden’s ranking as one of the most peaceful countries include its stable government, lack of corruption, and low murder rate.
It also refuses to participate in the constant bickering and warmongering of some other nations.
That allows it to spend its time and money on more lucrative ventures.
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Does Sweden Have Wealth Inequality?
Sweden does have wealth inequality but not nearly as much as the United States or many other countries in the list of 20 countries with the most billionaires.
However, it has the highest wealth inequality of all the Nordic countries.
According to an article in Nordregio Magazine, Sweden had the lowest level of income inequality of all the Nordic countries in 2000.
However, by 2017, it had the highest level of income inequality and has continued to hold that place in subsequent years.
Typically, income inequality is measured with a tool called the Gini Index [6].
This tool calculates the distribution of wealth across a specific population (i.e., a country).
The percentage range goes from 0% to 100%, with 0% representing a perfectly balanced and equal distribution of wealth.
On the other hand, 100% means there is absolutely no income equality within the population.
As of 2022, Sweden has a Gini Index of 30%, which is on the low side. (By comparison, the United States’ Gini Index is 41.4%, and South Africa’s is 63%.) Here’s a breakdown of the other Nordic countries:
- Iceland: 26.1%
- Finland: 27.3%
- Norway: 27.6%
- Denmark: 28.2%
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How Does Sweden Tax the Rich?
Sweden taxes the rich a 20% state tax in addition to the 52.90% local tax that all Swedes pay.
Sweden used to have a wealth tax and an inheritance tax, but they abolished those in 2007 and 2005, respectively.
Corporate tax rates are 20.6%, which is significantly lower than it once was.
That means that wealthy Swedes can pay over 70% in taxes, according to Trading Economics.
That extra 20% goes towards funding welfare programs, public schools, and programs that benefit all Swedish citizens.
Conclusion
Sweden is small, but it’s home to a surprising number of billionaires. Despite some wealth inequality and high taxes, most citizens are happy living there.
Also see What Do Swedes Think of Finns? to learn more.
References:
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