As earlier stated, the real and nominal gross domestic products of Sweden have been increasing. The real GDP of Sweden has had a significant growth as compared to the nominal GDP. The nominal GDP, however, has been used to determine whether the economy of Sweden is growing or not growing at the expected rate. The increased rate of growth is the result of the increased productivity that has been experienced in the country. There has been a major economic growth in Sweden since the nineteenth century which is usually compared to that of its neighbouring countries such as Finland. The increased productivity resulted from the transformation of the economic practices from an agricultural based economy to an industrial based economy (Bosworth, 1999, p. 156). Sweden’s productivity is mostly seen through its labour productivity and efficiency gains. Sweden was able to take advantage of the improvements in technology and several advancements that occurred in organizations. They, therefore, shifted their economic practices from agricultural to industrial ones. The change to industry based economy led to the expansion of the resources and industrial development. As a result industries were able to produce in bulk and also to produce better quality products which were more profitable. The expansion in the resources led to a growing domestic market and in the long run it led to a large world market. The shift to industrialization led to the need for labour. So many jobs were created in Sweden by the industries which called for more labour and hence increased labour productivity. Sweden, therefore, has an increased labour productivity because of the improved economy, the improved labour regulations and favourable compensations. The labour productivity and economy productivity in general improved in Sweden more as compared to other Scandinavian countries because of the demographic developments, the financial boost as a result of the First World War and the stable and viable economic structure of Sweden created in the nineteenth century. These factors are not present in other neighbouring countries and hence they are an added advantage to Sweden. Sweden is also very efficient in its production because of improved systems and reduced production costs and therefore its productivity is higher as compared to its neighbouring countries. The unemployment rate usually shows the labour trends in a country. It is the rate that shows the number of people that are not employed but they are capable of working (Layard, 2008, p. 78). The unemployment in Sweden is highly cyclical. This means that it depends on business cycles. Despite the increased productivity in Sweden, there has also been an increased rate of unemployment. The main cause of unemployment in Sweden has been the changes in business cycles. Sometimes during recession the economy is poor and so is the demand for labour which leads to lack of jobs and, as a result, unemployment. Inflation and unemployment rates in Sweden between the years 2000 and 2010 was reducing because of the improvements in the economy. There is a relationship between in unemployment and inflation rates in Sweden. High inflation rates lead to increased labour costs, and employers find it expensive to pay the high labour rates hence there will be increased unemployment. Sweden has a strong economy and its productivity has improved s