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During the 1980s, and with increasing speed, there have been major changes in the determination of wages in Sweden; changes which involve the substantial breakdown of the ‘Swedish model’ of social and economic policy which had developed since the 1930s. These changes are of much interest in themselves but have a special relevance to Australia because of admiration for the Swedish system within the Australian labour movement, exemplified by the major report Australia Reconstructed, published in 1987. Some of the complexities and difficulties involved in the Swedish system were not fully dealt with in this report, while others have become clear since its publication. Australians, as well as others, need to appreciate what has occurred. Centralised wage negotiation, essential to the Swedish model, has in fact survived better in Australia than in Sweden; though in Australia too it is potentially vulnerable to tendencies towards decentralisation. Those interested in the concept of ‘corporatism’ should also not...