Almost 85 per cent of the production of paper and pulp is exported. It is true that the mining industry is not as big as it once was. Its value added today accounts for just over 1 per cent of the total value added in industry. But after a period of stagnation at the beginning of the 1990s, net exports of ore increased at the end of the same decade to account for approximately 2 per cent of total net exports of industrial products. LKAB accounts for approximately 4 per cent of world trade in iron ore, and Swedish companies hold a dominant position in Europe in terms of production of iron, silver and lead.1 In spite of competition from countries with considerably faster-growing forests and cheaper ore, as well as the fact that technology in some areas has become easier to transfer between countries, the basic industries have survived several crises over the years. The reason for this and for the fact that basic industries are still relatively important today is probably that the owners of industry and its executive management have been quick to assimilate new technology and have constantly sought to refine and create a niche for their businesses. They have substituted labour for capital at a fast rate (see Figure 2) . Sweden’s biggest paper and pulp mill, Husum outside Örnsköldsvik, is run by 113 people per shift, while Boliden’s opencast mine, Maurliden, employs around 12 people when the mine is in operation.
This means that the value of the work performed decreased, as did the scope for higher real wages. Table 1. Capital intensity and productivity growth Industry  Business sector  Capital/ employee  Productivity  Capital/ employee  Productivity  1963-70  8.3%  7.6%  6.5%  5.3%  1970-80  6.3%  3.4%  6.2%  3.2%  1980-86  2.8%  3.2%  3.0%  2.0%  Source: Own calculations  The previous diagram also shows that the level of capital formation in relation to our total resources that we had during the 1960s has not returned but that the fluctuations have been larger after the mid 1970s. On average we have remained at approximately one-third of the level of resources that we previously had allocated to new capital. One difference is that saving has increased, but not investment. This means that we are exporting capital. Despite a continuation of relatively low capital formation, the weak trend seen in total Swedish labour productivity in recent years was broken during the first half of the 1990s when productivity growth increased. But it was other factors than capital formation that contributed to this. Among other things, the economic crisis at the beginning of the 1990s led to substantial rationalisation measures and the winding up of low-productivity operations, which resulted in increased productivity growth but also high unemployment. During the same period, there was also a shift in Swedish economic policy in order to create conditions for more sustainable long-term economic growth.