Arctic Yearbook 2014
increments and other benefits were paid to lure people to migrate to and work in the North.
Transport to the region and consumer goods were heavily subsidized. At the end of the Soviet
period, all of the various subsidies for northern development were estimated to cost 3 percent of
GDP. At that time, there were 9.5 million people living in the North and nearly 2 million in the
The breakup of the Soviet Union, liberalization of the society including freedom of movement, and
the shift from a centrally-planned to a market economy caused a shift in the direction of migration
in the North from moderate in-migration in the 1980s to rather large scale out-migration in the postSoviet period. The role of the state in northern development decreased considerably and
development became governed by market principles. Subsidies for transport, wages and benefits,
and other necessities were largely eliminated causing a huge increase in the cost of living resulting in
a large-scale exodus from the region (Figure 10).
Figure 10: Net Migration by Region, 1989 to 2008 (%)
By 1990, all northern regions had more people leaving than arriving and this trend has continued
past 2000, albeit at much lower rates than the early 1990s. The year of the greatest out-migration was
1992, the first year of the economic reforms and the year that prices were liberalized when the
market cost of living in the northern periphery began to be felt. Over the entire period, all northern