From Home Rule to Sovereignty: The Case of Iceland

Abstract

The story of Iceland, particularly in the modern period, represents a standing rebuke to traditional theories of small state viability. Although the total Icelandic population of 270 000 barely equals that of a small to medium-sized city, it is a thriving and viable state, clearly capable of taking care of most sovereign state functions. A study of living standards in the Nordic countries shows that, on most of the indicators used, Iceland’s were among the highest (Olafsson, 1990). Another study, covering a large number of countries in Europe and North America, showed that Icelanders generally claim to be happier and more satisfied with their quality of life than people in most other nations (Jonsson and Olafsson, 1991). This is the more remarkable because Iceland is a relatively new state and a late starter on the road to modernization, and because it appears to be isolated at the margins of geopolitical space in extreme northern latitudes.