Denmark's social model, set by the European Commission as an example for EU states to follow, cannot be emulated in most other countries, OECD Secretary-General Angel Gurria said on Tuesday.
The Danish model, called "flexicurity" as it is based on a combination of worker flexibility and worker security, needs a high tax system that is unlikely to be accepted elsewhere in the world, he said in a lecture on European reforms.
"The Danes are the happiest people in the world, but you have to be a Dane to be happy in those conditions, because it is explained by 150 years of evolution in that particular area," said Gurria, who heads the Organisation for Economic Cooperation and Development.
"What is not possible is to replicate this: When they are talking about the Danish or the Nordic model, this cannot be done in Brussels, this cannot be done in Paris, it cannot be done in Italy, it cannot be done in the United States," said Gurria, a former Mexican finance minister. The European Union is searching for a social model that would allow it to keep relatively generous welfare polices amid an ageing society and fierce global competition, especially from Asia.
The Danish model protects the worker, not the job, and envisages re-training and high levels of benefits during periods of unemployment. It can be financed thanks to one of the highest tax levels in Europe and similar models work in Sweden and Finland, which are also high-tax countries.
"They are not real alternatives, because each country gives itself, among other things, as one of the most important expressions of sovereignty, the tax regime that you choose for yourself," said Gurria.
"(People) want to get back what they put into the system and if they feel they are getting it back, they are happy. If they don't feel they are getting it back, even if they paid less taxes, as we have seen in other countries they will make very large protests," he said.
"Flexicurity can be borrowed by Brussels, and people here at the economic community can say they are adopting flexicurity. (But) a model where Europeans would like to have a 53 percent average tax rate? Maybe ... ," Gurria said.
Instead of the flexicurity model, other European countries should focus on emulating the good education systems of countries such as Finland, which would lead to higher productivity, innovation and eventually economic growth.
Better education was a key issue which should be taken up at one of Group of Eight meetings, perhaps in 2009, he said. The Group of Eight comprises the United States, Canada, Japan, Russia, Britain, Germany, France and Italy. The OECD groups 30 mostly industrialised countries with market economies.
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