Back from the Brink

• Main Authors: Tranøy, Bent Sofus, Sigurjonsson, Throstur Olaf
• Format: Book Part
• Language: unknown
• Published: Oxford University PressOxford 2022
• Subjects: Iceland
• Online Access: http://dx.doi.org/10.1093/oso/9780192856296.003.0019; https://academic.oup.com/book/chapter-pdf/53455653/oso-9780192856296-chapter-19.pdf

Abstract The story of Iceland’s successful economic recovery from financial meltdown in 2008 is different from the rest of this book. Temporally, it deals with a dramatic episode of crisis management, not ongoing public policy. Furthermore, while the typical policy success refers to a circumscribed programme, a full-scale economic crisis demands that fires are put out all over the place. Iceland had to deal with foreign policy, the IMF, financial, economic and social issues, simultaneously. To do so it combined Keynesian crisis fighting means such as propping up demand and capital controls We deem Iceland’s ability to stop the largest financial meltdown in history (relative to GDP) from wreaking lasting real economic damage a policy success along all four dimensions specified by the (PPPE)-framework, although the political success experienced by those who handled most of the clean-up job turned out to be more precarious than what they would have hoped for.