Prehistoric red ochre painted rock art of moose, human figures and boats in Astuvansalmi in Ristiina, the Southern Savonia region from ca. 3800–2200 BCE
According to archaeological evidence, the area now composing Finland was first settled around 8500 BCE during the Stone Age as the ice shield of the last ice age receded. The earliest people were hunter-gatherers, living primarily off what the tundra and sea could offer. Pottery is known from around 5300 BCE (see Comb Ceramic Culture).The arrival of the Battle Axe culture (or Cord-Ceramic Culture) in southern coastal Finland around 3200 BCE may have coincided with the start of agriculture. However, the earliest certain records of agriculture are from the late third millennium BCE. Even with the introduction of agriculture, hunting and fishing continued to be important parts of the subsistence economy, especially in the northern and eastern parts of the country.
The Bronze Age (1500–500 BCE) and Iron Age (500 BCE–1200 CE) were characterised by extensive contacts with other cultures in the Fennoscandian and Baltic regions. There is no consensus on when Finno-Ugric languages and Indo-European languages were first spoken in the area of contemporary Finland.
Swedish era (until 1809)
The sea fortress of Suomenlinna was founded by a discusion of the Swedish Diet in 1747 as a defence works and naval base, to be built on the islands off Helsinki.
Sweden established its official rule of Finland in the 13th century by the crown. Swedish became a dominant language of the nobility, administration and education; Finnish was chiefly a language for the peasantry, clergy and local courts in predominantly Finnish-speaking countries. The Bishop of Turku was usually the most important person in Finland during the Catholic era.
The Middle Ages ended with the Reformation when the Finns gradually converted to Lutheranism. In the 16th century, Mikael Agricola published the first written works in Finnish. The first university in Finland, The Royal Academy of Turku, was established in 1640. In the 18th century, wars between Sweden and Russia led to occupation of Finland twice by Russian forces, known to the Finns as the Greater Wrath (1714–1721) and the Lesser Wrath (1742–1743). By this time “Finland” was the predominant term for the whole area from the Gulf of Bothnia to the Russian border.
Grand Duchy in the Russian Empire (1809–1917)
Main article: Grand Duchy of Finland
On March 29, 1809, after being conquered by the armies of Alexander I of Russia in the Finnish War, Finland became an autonomous Grand Duchy in the Russian Empire until the end of 1917. During the Russian era, the Finnish language started to gain recognition, first probably to sever the cultural and emotional ties with Sweden and thereafter, from the 1860s onwards, as a result of a strong nationalism, known as the Fennoman movement. Milestones included the publication of what would become Finland’s national epic, the Kalevala, in 1835; and the Finnish language achieving equal legal status with Swedish in 1892.
Despite the Finnish famine of 1866-1868 – the last major famine in Europe – in which about 15 percent of the population died, political and economic development was rapid from the 1860s onwards. The disaster of famine led Russian Empire to ease regulation and investment rose in following decades. The GDP per capita was still a half of United States and a third of Great Britain.
In 1906, universal suffrage was adopted in the Grand Duchy of Finland, the second country in the world where this happened. However, the relationship between the Grand Duchy and the Russian Empire soured when the Russian government made moves to restrict Finnish autonomy. For example, the universal suffrage was, in practice, virtually meaningless, since the emperor did not approve any of the laws adopted by the Finnish parliament. Desire for independence gained ground, first among radical nationalists and socialists.
Civil War (1917–1918) and early independence
On December 6, 1917, shortly after the Bolshevik Revolution in Russia, Finland declared its independence, which was approved by Bolshevist Russia.
Contrary to Lenin’s and Finnish socialists’ expectations, the majority of Finns voted non-socialists parties in 1917 general elections. Soon in 1918, the violent wing of social democratic party started a coup, which led a brief but bitter Civil War that affected domestic politics for many decades afterwards. The Civil War was fought between “the Whites”, who were supported by Imperial Germany, and “the Reds”, supported by Bolshevist Russia. Eventually, the Whites overcame the Reds. The deep social and political enmity between the Reds and Whites remained. The civil war and activist expeditions (see Heimosodat) to the Soviet Union strained eastern relations.
After a brief flirtation with monarchy, Finland became a presidential republic, with Kaarlo Juho Ståhlberg elected as its first president in 1919. The Finnish–Russian border was determined by the Treaty of Tartu in 1920, largely following the historic border but granting Pechenga (Finnish: Petsamo) and its Barents Sea harbour to Finland. Finnish democracy didn’t see any more Soviet coup attempts and survived the anti-Communist Lapua Movement. The relationship between Finland and the Soviet Union was tense. Finnish ethnicity was targeted by genocide in the Soviet Union, though little of that was known in Finland. Finland disliked all forms of socialism, leading Germany’s national socialism to deteriorate relations with Germany. Military was trained in France instead and relations to Western Europe and Sweden were strengthened.
In 1917 the population was 3 million. Land reform was enacted after the civil war, increasing the percantage of capital-owning population. About 70% of workers were occupied in agriculture and 10% in industry. The largest export markets were United Kingdom and Germany. Great Depression in the early ’30s was relatively light in Finland.
Finland during World War II
During World War II, Finland fought the Soviet Union twice: in the Winter War of 1939–40 after the Soviet Union had attacked Finland and in the Continuation War of 1941–44, following Operation Barbarossa in which Nazi Germany invaded the Soviet Union. Following German losses on the Eastern Front and the subsequent Soviet advance, Finland was forced to make peace with the Soviet Union. This was followed by the Lapland War of 1944–45, when Finland forced the Germans out of northern Finland.
The treaties signed in 1947 and 1948 with the Soviet Union included Finnish obligations, restraints, and reparations as well as further Finnish territorial concessions (cf. the Moscow Peace Treaty of 1940). Finland ceded most of Finnish Karelia, Salla, and Pechenga, which amounted to ten percent of its land area and twenty percent of its industrial capacity. Some 400,000 evacuees, mainly women and children, fled these areas. Establishing trade with the Western powers, such as the United Kingdom, and the reparations to the Soviet Union caused Finland to transform itself from a primarily agrarian economy to an industrialised one. Even after the reparations had been paid off, Finland continued to trade with the Soviet Union in the framework of bilateral trade.
In 1950 a half of the workers was occupied in agriculture and a third lived in urban towns. The new jobs in manufacturing, services and trade quickly attracted people towns. The average number of births per woman declined from baby boom peak 3.5 in 1947 to 1.5 in 1973. When baby boomers entered the workforce, the economy didn’t generate jobs fast enough and hundreds of thousands emigrated to the more industrialized Sweden, migration peaking in 1969 and 1970. This mass migration is largely the reason why 4.7 percent of Sweden’s population speak Finnish today.
Officially claiming to be neutral, Finland lay in the grey zone between the Western countries and the Soviet Union. The “YYA Treaty” (Finno-Soviet Pact of Friendship, Cooperation, and Mutual Assistance) gave the Soviet Union some leverage in Finnish domestic politics. This was extensively exploited by President Urho Kekkonen against his opponents. He maintained an effective monopoly on Soviet relations, which gave him a status of “only choice for president”. There was also a tendency of self-censorship regarding Finno-Soviet relations. This phenomenon was given the name “Finlandisation” by the German press (fi. suomettuminen). When Finlandisation was not enough, direct censorship was used, including in 1700 books and many movies, and asylym-seeking defectors were returned to be killed by the Soviet Union. Soviets created and financed anti-Western and pro-Soviet youth movements peaking in 70s, when communist-led Teen Union harassed teachers suspected of bourgeois ideas, and their former members have still a lot power. Soviet intelligence services sometimes used their contacts to install personnel in the administration, mass media, academia, political parties and trade unions. Politicization was widespread and public sector workers were often dependent on having the correct political party membership.
However, Finland maintained a democratic government and a market economy unlike most other countries bordering the Soviet Union. Property rights were strong. While nationalization committees were set up in France and UK, Finland avoided nationalizations. After failed experiments with protectionism, Finland eased restrictions and made a free trade agreement with the European Community in 1973, making its markets more competitive. Local education market expanded and an increasing number of Finns also went to have education in the United States or Western Europe, bringing back advanced skills. There was quite common, but pragmatic-minded, credit and investment cooperation by state and corporations, though it was considered with suspicion. Support for capitalism was widespread. Savings rate hovered among the world’s highest, at around 8% until 80s. In the beginning of the 1970s, Finland’s GDP per capita reached the level of Japan and the UK. Finland’s development shared many aspects with Asian countries such as Japan, Korea and Taiwan.
Having been targeted by Soviet intelligence and youth propaganda, liberals lost support and socialist-majority generations seized power in 70s and 80s. Corporatism and taxes were increased. The power of social democrats and the almost overnight-grown trade union SAK became hegemonic in politics. In 1991 Finland fell into a Great Depression-magnitude depression caused by combination economic overheating, depressed Western, Soviet and local markets, and disappearance of Soviet barter system. Stock market and housing prices declined by 50%. The growth in the 1980s was based on debt, and when the defaults began rolling in, GDP declined by 15% and unemployment increased from a virtual full employment to one fifth of the workforce. The crisis was amplified by trade unions’ initial opposition to any reforms. Politicians struggled to cut spending and the public debt doubled to around 60% of GDP. After devaluations the depression bottomed out in 1993.
Liberalization and integration with the West
Like other Nordic countries, Finland has liberalized the economy since late 80s. Financial and product market regulation was removed. The market is now one of the most free in Europe. State enterprises were privatized and taxes were cut. However, unlike in Denmark, trade unions blocked job market reforms, causing persistent unemployment and a two-tier job market. Trade unions also blocked social security reform proposals towards basic income or negative income tax. Finland joined the European Union in 1995. The central bank was given an inflation-targeting mandate until Finland joined eurozone. The growth rate has since been one of the highest of OECD countries and Finland has topped many indicators of national performance.
In addition to fast integration with the European Union, safety against Russian leverage has been increased by building fully NATO-compatible military. 1000 troops (a high per-capita amount) are simultaneously committed in NATO operations. Finland has also opposed energy projects that increase dependency on Moscow. At the same time, Finland remains one of the last non-members in Europe and there seems to be not enough support for full membership unless Sweden joins first.
The population is aging with the birth rate at 10.42 births/1,000 population or fertility rate at 1.8. With median age at 41.6 years Finland is one of the oldest countries  and a half of voters is estimated to be over 50 years old. Like most European countries, without further reforms or much higher immigration Finland is expected to struggle with demographics, even though macroeconomic projections are healthier than in most other developed countries.