the icelandic welfare state: nordic or anglo-saxon? professor hannes h. gissurarson nopsa-36,...
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The Icelandic Welfare State:Nordic or Anglo-Saxon?
Professor Hannes H. GissurarsonNOPSA-36, Gothenburg 14 August 2014, 13–15
Lower Rate, More Revenue
1990 1995 2000 200315
20
25
30
35
40
45
50
55
0.7
0.8
0.9
1.0
1.1
1.2
1.3
Corporate Tax Rate Corporate Tax Revenue % of GDP
Corporate Tax Rate
Corporate Tax Revenue % of
GDP
Stabilisation: Inflation fell
19801982
19841986
19881990
19921994
19961998
20002002
20040
102030405060708090
Inflation in %
Sustainable Strong Pension Funds
NetherlandsIceland
SwitzerlandUnited States
United KingdomFinland
AustraliaIrelandCanada
Denmark
0 20 40 60 80 100 120 140
Pension Fund Assets 2005 % of GDP
Public Expenditure in Iceland
19881990
19921994
19961998
20002002
20042006
20082010
201205
101520253035404550
Central Government Expenditure as % of GDP
Economic Freedom in the North
1975 1980 1985 1990 1995 2000 2005 20104.5
5
5.5
6
6.5
7
7.5
8
Finland Denmark Norway Sweden Iceland
2003 Debate on “Hidden Poverty”
Eurostat on 2003–4 Poverty
Ireland
United Kingdom
Denmark
Finland
Norway
Iceland
Sweden
0 5 10 15 20 25
At- risk-of-poverty rate 2004
Olafsson’s Income Distribution
Sweden
Denmark
Finland
Norway
United Kingdom
Iceland 1995
Iceland
0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4
Gini Coefficients 2004
Eurostat Income Distribution
Sweden
Denmark
Iceland
Iceland 1995
Finland
Norway
United Kingdom
0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4
Gini Coefficients 2004
Gini Coefficients after 2004
2005 2006 2007 2008 2009 2010 2011 20120
5
10
15
20
25
30
35
Top Credit Ratings Created Bubble
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009
A2A1
Aa3
AaaAa1
A1
Baa3
Baa1
Bubble: 2004 Crucial Year
1992 1996 2000 2004 20080
2000000
4000000
6000000
8000000
10000000
12000000
14000000
16000000
External debt in millions of kronur
2004–8: Baugur Bubble
1/1/05 1/1/06 1/1/07 1/1/080
1000
2000
3000
4000
5000
6000
Loans to Baugur and re-lated companiesLoans to Exista and re-lated companiesLoans to Landsbanki main owners and related com-panies
101: Baugur Group Private Jet
101: Baugur Group Private Yacht
Seven EU countries hit harder
Latvia
Lithuania
Estonia
Finland
Slovenia
Hungary
Romania
Iceland
Ireland
0 2 4 6 8 10 12 14 16 18 20
GDP Contraction 2009 in %
All Income Groups Suffered
2004 2005 2006 2007 2008 2009 2010 2011 20120
100000
200000
300000
400000
500000
600000
700000
800000
Fixed price mean income for three quintiles
Lowest quintileThird quintileHighest quintile
Living standards relative to EU average
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013100
105
110
115
120
125
130
135
Icelandic GDP per capita as % of 28 EU states average