Sweden is a constitutional monarchy with a parliamentary democracy, where the monarch serves as head of state while executive power lies with the government. The country's highly developed economy combines free-market capitalism with a strong welfare state model (known as the "Nordic model"). Sweden's economic strength comes from its advanced manufacturing sector (particularly in telecommunications, automobiles, and engineering), natural resources (timber, iron ore), technology innovation, and services. The country is known for its high standard of living, environmental sustainability, social equality, and strong public services, though it maintains its own currency (Swedish krona) despite being in the [[European Union (EU)]].