Sverige och euron : En kontrafaktisk analys med syntetiska kontrollmetoder

The study investigates how the Swedish economy would have developed if it had adopted the euro after the referendum in 2003. The analysis includes GDP per capita, unemployment, inflation, exports, foreign direct investment, interest rates on long-term government bonds, and household gross disposable income per capita. The purpose is to contribute empirically to the political and societal debate on a potential Swedish euro adoption by highlighting possible economic consequences of the euro. The study applies synthetic control methods to construct a counterfactual scenario named synthetic Sweden. Synthetic Sweden is based on euro countries that developed similarly to Sweden before their euro adoption. Previous studies have revealed mixed results of a Swedish euro adoption, depending on which variables have been studied. At the same time, several of these studies have pointed out methodological limitations in the synthetic models. Unlike earlier studies, where synthetic Sweden is often constructed using euro and non-euro countries, this study limits the composition of synthetic Sweden to euro area countries and Denmark, whose currency is pegged to the euro. This limitation is done to improve methodological robustness. Our results show that Sweden’s decision to keep the Swedish krona has benefited GDP per capita and interest rates on long-term government bonds. From 2009 onwards, Sweden’s GDP per capita was on average 4.6% higher than Sweden's with the euro scenario. Between 2010 and 2020, the interest rates on Swedish long-term government bonds were also 1.02 percentage points lower than in the scenario where Sweden had adopted the euro.