Jonathan Nackstrand / AFP - Getty Images

Firemen extinguish a burning car in Kista, Stockholm after riots on Tuesday night.

STOCKHOLM - Hundreds of youths set fire to cars and attacked police and rescue services in suburbs of Stockholm Tuesday night in Sweden's worst disorder in years.

A police station in the Jakobsberg area in the northwest of the city was attacked, two schools were damaged and an arts and crafts center was set ablaze, despite a call for calm from Prime Minister Fredrik Reinfeldt.

It was the third night of unrest, mainly in suburbs where many immigrants live.

The riots, in one of Europe's richest capitals, have shocked a country that prides itself on a reputation for social justice, and fuelled a debate about how Sweden is coping with both youth unemployment and an influx of immigrants.

"We've had around 30 cars set on fire last night, fires that we connect to youth gangs and criminals," Kjell Lindgren, spokesman for Stockholm police, said on Wednesday.

He said eight people had been arrested on Tuesday night, but there were no reports of injuries.

The riots appear to have been sparked by the police killing of a 69-year-old man wielding a machete in the suburb of Husby this month, which prompted accusations of police brutality.

"Everyone must pitch in to restore calm - parents, adults," Reinfeldt told reporters on Tuesday.

After decades of practicing the "Swedish model" of generous welfare benefits, Sweden has been reducing the role of the state since the 1990s, spurring the fastest growth in inequality of any advanced OECD economy.

While average living standards are still among the highest in Europe, governments have failed to substantially reduce long-term youth unemployment and poverty, which have affected immigrant communities worst.

The left-leaning tabloid Aftonbladet said the riots represented a "gigantic failure" of government policies, which had underpinned the rise of ghettos in the suburbs.

"We have failed to give many of the people in the suburbs a hope for the future," Anna-Margrethe Livh of the opposition Left Party wrote in the daily Svenska Dagbladet.

An anti-immigrant party, the Sweden Democrats, has risen to third in polls ahead of a general election due next year, reflecting unease about immigrants among many voters.

Some 15 percent of the population is foreign-born, the highest proportion in the Nordic region. Unemployment among those born outside Sweden stands at 16 percent, compared with 6 percent for native Swedes, according to OECD data.

Among 44 industrialized countries, Sweden ranked fourth in the absolute number of asylum seekers, and second relative to its population, according to U.N. figures. 

Suzanne Plunkett / Reuters

European Commission President Jose Manuel Barroso, left, European Council President Herman van Rompuy and European Parliament President Martin Schulz, seen here on Sunday, will receive the Nobel Peace Prize on behalf of the European Union in Oslo on Monday.

Updated at 9:20 a.m. ET: OSLO, Norway -- The European Union received the Nobel Peace Prize on Monday, as the Norwegian committee looked beyond Europe's current malaise to recognize its decades of stability and democracy after the horrors of two world wars.

Fittingly for an institution with no single leader, the EU sent three of its presidents to the Oslo ceremony for the 2012 prize, which critics including former Nobel laureate Desmond Tutu say is undeserved.

About 20 European government leaders, including German Chancellor Angela Merkel, French President Francois Hollande and British Deputy Prime Minister Nick Clegg, also attended the ceremony.

"Sixty years of peace. It's the first time that this has happened in the long history of Europe," Herman Van Rompuy, the president of the European Council, said before the ceremony.

"The facts prove that the European Union is a peacekeeping instrument of the first order," said Van Rompuy, who was on hand to collect the prize along with European Commission President Jose Manuel Barroso and Martin Schulz, the president of the European Parliament.

Two Americans win Nobel for work on matching different economic agents

Economic pain
Europe is suffering feeble economic growth or outright recession, soaring unemployment and a number of its member states are unable to pay their debts. It has been called the worst economic crisis since World War II.

The economic pain has provoked social unrest in a number of member states, notably near-bankrupt Greece.

However, the Nobel committee focused on the EU's role in reconciling the disparate, warring corners of the "old continent" -- the overarching success being to turn Germany and France from enemies into allies.

From just six countries that agreed to pool their coal and steel production in the 1950s to 27 member states today -- and 28 once Croatia joins next year -- the EU now stretches from Portugal to Romania, Finland to Malta and sets rules and regulations that have a bearing on more than 500 million people.

"The stabilizing part played by the EU has helped to transform most of Europe from a continent of war to a continent of peace," the Nobel committee said on Oct. 12 when it announced the EU had won, an unexpected decision.

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The prize money of $1.25 million will be given to projects that help children struggling in war zones, with the recipients to be announced next week. The EU has said it will match the prize money, doubling the sum to be given to selected aid projects.

The awarding of the prize to the EU has provoked criticism from some quarters.

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Three Peace Prize laureates -- Tutu, Mairead Maguire of Northern Ireland and Adolfo Perez Esquivel from Argentina -- have demanded that prize money of $1.2 million not be paid this year. They said the bloc contradicts the values associated with the prize because it relies on military force to ensure security.

Amnesty International said Monday that EU leaders should not "bask in the glow of the prize," warning that xenophobia and intolerance are now on the rise in Europe.

The Nobel Peace Prize is awarded each year in Oslo on Dec. 10, the anniversary of Alfred Nobel's death in 1896. Similar ceremonies are to be held in the Swedish capital, Stockholm, for the Nobel laureates in medicine, chemistry, physics and literature.

Reuters and The Associated Press contributed to this report.

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Bertil Enevag Ericson / Scanpix Sweden via Reuters

Police vans stand guard outside the Sagerska Palace, the official residence of the Swedish Prime Minister Fredrik Reinfeldt, after a man died inside either by committing suicide or in an accident on Friday.

STOCKHOLM — A man has died inside Swedish Prime Minister Fredrik Reinfeldt's residence in Stockholm after either committing suicide or an accident, but the prime minister and his family were safe, police said Friday.

"There are no signs of a crime. We investigate this as a suicide or a work-related accident," Towe Hagg, a police spokeswoman, told Reuters.

Media said the man died of gunshot wounds.

The dead man was not part of the prime minister's personal bodyguards but had full clearance to be in the building. Another official said he was a security guard who worked at the residence.

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