Financialisation and financial crisis in Iceland
Financialisation in Iceland should be seen as an evolving process driven by a mixture of global and domestic forces. Responding to fundamental issues underlying macroeconomic imbalances, the authorities introduced policies that proved particularly supportive of financial expansion at a time when cro...
| Published in: | European Journal of Economics and Economic Policies: Intervention |
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| Format: | Article in Journal/Newspaper |
| Language: | unknown |
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Edward Elgar Publishing
2016
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| Online Access: | http://dx.doi.org/10.4337/ejeep.2016.03.05 https://www.elgaronline.com/view/journals/ejeep/13/3/article-p292.xml https://www.elgaronline.com/downloadpdf/journals/ejeep/13/3/article-p292.xml |
| Summary: | Financialisation in Iceland should be seen as an evolving process driven by a mixture of global and domestic forces. Responding to fundamental issues underlying macroeconomic imbalances, the authorities introduced policies that proved particularly supportive of financial expansion at a time when cross-border capital movements were rapidly on the rise. Consequently, the rise in financial activity has had profound effects on income distribution and corporate and household behaviour. Following the 2008 financial meltdown, which was triggered by excessive growth of the financial sector, financialisation in Iceland has reversed to a degree, allowing for a shift away from financial-led towards increasingly export-led growth. |
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