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Iceland: How Could This Happen?

Author

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  • Thorvaldur Gylfason

Abstract

This paper reviews economic developments in Iceland following its financial collapse in 2008, focusing on causes and consequences of the crash. The review is presented in the context of the Nordic region, with broad comparisons also with developments elsewhere on the periphery of Europe, in Greece, Ireland, and Portugal. In some ways, however, Iceland resembles Italy, Japan, and Russia more than it resembles its Nordic neighbors or even Ireland. The paper also considers the uncertain prospects for reforms and restoration as well as the possible effects of the crash on social, human, and real capital and on long-run economic growth.

Suggested Citation

  • Thorvaldur Gylfason, 2014. "Iceland: How Could This Happen?," CESifo Working Paper Series 4605, CESifo.
    • Handle: RePEc:ces:ceswps:_4605
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp4605.pdf
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    References listed on IDEAS

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    Cited by:

    1. Thorvaldur Gylfason, 2014. "Constitution on Ice," CESifo Working Paper Series 5056, CESifo.
    2. Thorvaldur Gylfason & Gylfi Zoega, 2014. "The Dutch Disease in Reverse: Iceland’s Natural Experiment," OxCarre Working Papers 138, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.

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    More about this item

    Keywords

    Iceland; financial crisis; social capital;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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