Multi-locality and municipal finances: Insights from financial statements in Finland

Multi-local living, which encompasses work, study, leisure, and family relationships, represents a lifestyle whereby individuals move between and reside in multiple locations. It has become increasingly common in Europe, particularly in the Nordic countries, Switzerland, Austria, Germany, and the UK, driven by individualized lifestyles and changes in work habits facilitated by digital infrastructure and transport solutions. Despite its growing popularity, the impacts of multi-local living on municipal finances remain under-researched. The purpose of the article is to address that gap based on a statistical analysis of municipal financial statements to assess the significance of multi-locality on municipal finances. Understanding these impacts is crucial for addressing the challenges and development needs arising from increasing human mobility. Rural municipalities with long-standing structural problems and selective migration may be particularly vulnerable to the burdens of multi-local living. The results show that although multi-locality is not officially considered in municipal financing, it does not significantly weaken municipal finances. In conclusion, in Finland, municipalities with multi-local residents receive property tax revenue, which significantly offsets the costs associated with multi-locality.