The fiscal consequences of immigration: a study of local governments’ expenditures

Matti Viren
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Matti Viren: University of Turku, Finland.

No 151, Discussion Papers from Aboa Centre for Economics

Abstract: In this paper we examine how Finnish municipalities’ expenditures depend on the share of citizens with foreign background out of the total population. Empirical analyses make use of Finnish panel data from 295 municipalities and 202 migrant nationalities for the period 1987-2018. It turns out that the share of foreign population tends to increase per capita expenditures up to the point where the respective semi-elasticity is about one. The result seems robust in terms of different control variables, subsamples of the data and estimation techniques. Sizeable differences between different nationalities could, however, be detected. Thus, we cannot assume that the use of public services is neutral in terms of demographic changes and that should be considered when making assessments on overall fiscal effects of migration.

Keywords: government expenditures; migration; local government (search for similar items in EconPapers)
JEL-codes: H24 H31 H42 H71 J15 J61 (search for similar items in EconPapers)
Pages: 28
Date: 2022-05
New Economics Papers: this item is included in nep-int, nep-lab, nep-pbe and nep-ure
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:tkk:dpaper:dp151

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