Economic Activity in Turbulence: Banks and Financial Markets
In the aftermath of the failure of the Icelandic financial sector, embedded flaws of all the main pillars of the Icelandic economic system became evident. Individuals and institutions alike failed so that the system itself did not deliver the outcome it was set to do. This article presents a survey...
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Research in applied business and economics
2010
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fticelandunivojs:oai:ojs.pkp.sfu.ca:article/2296 2023-08-20T04:07:25+02:00 Economic Activity in Turbulence: Banks and Financial Markets Bankar og fjármálamarkaðir Johnsen, Guðrún 2010-12-15 application/pdf https://ojs.hi.is/index.php/efnahagsmal/article/view/a.2010.7.2.4 isl ice Research in applied business and economics Tímarit um viðskipti og efnahagsmál https://ojs.hi.is/index.php/efnahagsmal/article/view/a.2010.7.2.4/pdf https://ojs.hi.is/index.php/efnahagsmal/article/view/a.2010.7.2.4 Copyright (c) 2016 Tímarit um viðskipti og efnahagsmál Research in applied business and economics; Vol. 7 No. 2 (2010); 47-60 Tímarit um viðskipti og efnahagsmál; Bnd. 7 Nr. 2 (2010); 47-60 1670-4851 1670-4444 Financial crisis banks L51 Hvatakerfi stofnannauppbygging fjármálastofnanir fjármálastöðugleiki info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion 2010 fticelandunivojs 2023-08-01T12:29:31Z In the aftermath of the failure of the Icelandic financial sector, embedded flaws of all the main pillars of the Icelandic economic system became evident. Individuals and institutions alike failed so that the system itself did not deliver the outcome it was set to do. This article presents a survey of the main stakeholders of the financial system and maps out the incentive structure which defines the system and its outcome. The main conclusion is that the institutional structure of Iceland needs significant repairs so that Iceland can be considered favourable place for investments. The main weaknesses identified by this paper lie in the judicial system, given the lack of specialization among judges, as well as class-action suits being illegal; the low turnover and small size of the stock market; and a weak governance structure of firms. Incentive schemes of the fallen Icelandic banks proved also to be highly flawed in terms of protecting the interests of the minority shareholder. Eftir íslenska bankahrunið þykir ljóst að meginstoðir fjarmala- og efnahagskerfisins voru á veikum grunni reistar. Stofnanir jafnt sem einstaklingar brugðust og kerfið í heild stóðst ekki þær kröfur sem gerðar voru til þess. Hér verður farið yfir hverjir eru haghafar bankakerfisins sem knúðir eru áfram af ólíkum hagsmunum og hvötum. Þá er spurt hvaða veikleika megi finna meðal þeirra meginhvata sem eru byggingarefni hins íslenska efnahags- og fjármálakerfis. Niðurstaðan er sú að brotalamir má finna á öllum helstu stoðum kerfisins sem fjárfestar reiða sig á, svo sem í dómskerfi, skilvirkni markaða, hvatakerfum bankastofnana, og stjórnarháttum fyrirtækja. Valdhafar landsins verða að lagfæra þessar brotalamir hið fyrsta svo að íslenskt efnahagslíf og íslenskur fjármálamarkaður geti talist frjór jarðvegur fyrir fjárfesta að yrkja. Article in Journal/Newspaper Iceland University of Iceland: Peer Reviewed Journals Gerðar ENVELOPE(-20.878,-20.878,63.834,63.834) |
institution |
Open Polar |
collection |
University of Iceland: Peer Reviewed Journals |
op_collection_id |
fticelandunivojs |
language |
Icelandic |
topic |
Financial crisis banks L51 Hvatakerfi stofnannauppbygging fjármálastofnanir fjármálastöðugleiki |
spellingShingle |
Financial crisis banks L51 Hvatakerfi stofnannauppbygging fjármálastofnanir fjármálastöðugleiki Johnsen, Guðrún Economic Activity in Turbulence: Banks and Financial Markets |
topic_facet |
Financial crisis banks L51 Hvatakerfi stofnannauppbygging fjármálastofnanir fjármálastöðugleiki |
description |
In the aftermath of the failure of the Icelandic financial sector, embedded flaws of all the main pillars of the Icelandic economic system became evident. Individuals and institutions alike failed so that the system itself did not deliver the outcome it was set to do. This article presents a survey of the main stakeholders of the financial system and maps out the incentive structure which defines the system and its outcome. The main conclusion is that the institutional structure of Iceland needs significant repairs so that Iceland can be considered favourable place for investments. The main weaknesses identified by this paper lie in the judicial system, given the lack of specialization among judges, as well as class-action suits being illegal; the low turnover and small size of the stock market; and a weak governance structure of firms. Incentive schemes of the fallen Icelandic banks proved also to be highly flawed in terms of protecting the interests of the minority shareholder. Eftir íslenska bankahrunið þykir ljóst að meginstoðir fjarmala- og efnahagskerfisins voru á veikum grunni reistar. Stofnanir jafnt sem einstaklingar brugðust og kerfið í heild stóðst ekki þær kröfur sem gerðar voru til þess. Hér verður farið yfir hverjir eru haghafar bankakerfisins sem knúðir eru áfram af ólíkum hagsmunum og hvötum. Þá er spurt hvaða veikleika megi finna meðal þeirra meginhvata sem eru byggingarefni hins íslenska efnahags- og fjármálakerfis. Niðurstaðan er sú að brotalamir má finna á öllum helstu stoðum kerfisins sem fjárfestar reiða sig á, svo sem í dómskerfi, skilvirkni markaða, hvatakerfum bankastofnana, og stjórnarháttum fyrirtækja. Valdhafar landsins verða að lagfæra þessar brotalamir hið fyrsta svo að íslenskt efnahagslíf og íslenskur fjármálamarkaður geti talist frjór jarðvegur fyrir fjárfesta að yrkja. |
format |
Article in Journal/Newspaper |
author |
Johnsen, Guðrún |
author_facet |
Johnsen, Guðrún |
author_sort |
Johnsen, Guðrún |
title |
Economic Activity in Turbulence: Banks and Financial Markets |
title_short |
Economic Activity in Turbulence: Banks and Financial Markets |
title_full |
Economic Activity in Turbulence: Banks and Financial Markets |
title_fullStr |
Economic Activity in Turbulence: Banks and Financial Markets |
title_full_unstemmed |
Economic Activity in Turbulence: Banks and Financial Markets |
title_sort |
economic activity in turbulence: banks and financial markets |
publisher |
Research in applied business and economics |
publishDate |
2010 |
url |
https://ojs.hi.is/index.php/efnahagsmal/article/view/a.2010.7.2.4 |
long_lat |
ENVELOPE(-20.878,-20.878,63.834,63.834) |
geographic |
Gerðar |
geographic_facet |
Gerðar |
genre |
Iceland |
genre_facet |
Iceland |
op_source |
Research in applied business and economics; Vol. 7 No. 2 (2010); 47-60 Tímarit um viðskipti og efnahagsmál; Bnd. 7 Nr. 2 (2010); 47-60 1670-4851 1670-4444 |
op_relation |
https://ojs.hi.is/index.php/efnahagsmal/article/view/a.2010.7.2.4/pdf https://ojs.hi.is/index.php/efnahagsmal/article/view/a.2010.7.2.4 |
op_rights |
Copyright (c) 2016 Tímarit um viðskipti og efnahagsmál |
_version_ |
1774719036504932352 |