Edited by Peter Nijkamp, Jacques Poot and Mediha Sahin
Chapter 12: Profiles of Estonian immigrants and their participation in the Finnish welfare system
Immigration and consequences thereof have long been subject to major concern in many European countries. Economic recession and the austerity measures that are required to restore the balance of government budgets in the near future have also served to boost the discussion on the stress that the inflow of immigrants places on public finances in European countries. The pressures that migration causes for public spending and infrastructure investments are particularly relevant for countries with extensive welfare states and public services. From the receiving countries’ point of view it is naturally desirable that immigrants contribute to the economy rather than just consume its resources. The aim of this study is to investigate the role of a significant immigrant group, Estonians, on the Finnish welfare state. In particular, we put under scrutiny welfare utilization of Estonian immigrants and its determinants, and the net fiscal impact they exert on the Finnish welfare state, that is whether they pay more direct taxes than they receive as welfare transfers. We study in more detail the labour market performance and benefit recipiency of Estonian immigrants in Finland and how they compare to natives in terms of their characteristics. Estonians constitute a large share of immigration into Finland, being the third largest group after Russians and Swedes. During the period of investigation there has also been a change in the Finnish immigration policies concerning Estonians as Estonia became a member of the EU in 2004.
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