Norway is a stupid example. Sweden, Denmark, Finland and Iceland easily have the same level of welfare or arguably better than Norway in many regards. The key is to make public investments into the country's resources (be it farmland, forestry, mines, electricity) and build infrastructure and institutions that benefit the people.
By investing directly, you are doing the thinking instead of deferring judgement to bankers and the "invisible hand" that's really just a bunch of rich dudes with their own incentives that don't align with yours. You cut out billionaire middlemen and money doesn't have to "trickle down", and you can steer the behavior of your industries and universities toward causes that take your country's needs over time into account.
That's how good investors think about their business empires - why should countries choose to not strategize at all and just let nature do its thing?