Big business in a thin market: understanding the privatization of residential care for children and youth in Sweden

This article analyzes the transformation of Swedish residential care for children from a regionally coordinated, public social service system into a thin, but highly profitable, national spot market in which large corporations have a growing presence. Marketization and privatization are theorized as complex processes, through which the institutional structure and logics of this small, but significant, social policy field changed profoundly. Using official documents, register data, media reports and existing research, three consecutive phases in the development of the children's home market are identified since the early 1980s. Change was driven on one hand by policies inspired by New Public Management, which shifted public authority horizontally to the private sector, and vertically to local authorities (funding) and to the state (regulation). On the other hand were the responses of local authorities and private actors to the changing incentives that policy shifts entailed. During the first two phases, both the proportion and size of for-profit providers increased, and the model of family-like care was replaced by a professional model. Cutting across the trend of privatization in the third phase was establishment of a parallel system of homes for unaccompanied refugee children – mostly in public ownership. Similarities with privatization in the English system of children's care homes are noted. By showing how the Swedish market for residential care has been created by policy and by actors’ responses to those reforms, the article provides a foundation for thinking through how the predictable, significant and well-documented problems of such care markets might be addressed.