Subsidies, But for What? A Comparative Look at Finland’s Green Subsidies

Abstract

This brief examines environmental and energy-related business subsidies in Finland and compares them with those in other EU countries. In Finland, subsidies are concentrated on tax concessions and preservation-oriented support for which there is limited amount of research, and the existing studies show limited effectiveness. By contrast, investment and innovation subsidies, which potentially have a greater potential to accelerate the green transition, make up a smaller share of the overall support. Internationally, Finland stands out with a high level of subsidies, but structurally it differs from, for example, Germany, where the emphasis is on direct investment support. The analysis suggests that redirecting subsidies from tax concessions towards conditional, impact-oriented instruments could better support permanent emission reductions, technological development and economic renewal.

Publication info

Results of research
Charting the change: innovations, wellbeing and economic transformations (Cartagena)
Research group
Macroeconomy and public finances
Series
ETLA Muistio - ETLA Brief 163
Date
01.09.2025
Keywords
Green transition subsidies, State subsidies, Environmental policy funding, Industrial policy
ISSN
2323-2463
JEL
H23, H25, H81, Q58, O38
Pages
12
Language
Finnish