Labor income earned in Iceland in 1987 went untaxed. I use this episode to study labor supply responses to temporary wage changes. I construct a new population-wide dataset of earnings and working time from pay slips and use two identification strategies to estimate intensive and extensive...

This paper reviews Iceland’s performance in skills accumulation against the backdrop of a rapidly changing economic environment and discusses directions for further improvements. Since the late 1990s, the government has considerably raised expenditure on education, which is now among the...

Iceland has high living standards, low poverty, high inclusiveness and one of the most sustainable pension systems. It is the most highly unionised country in the OECD and, in the past, successful social pacts have protected the lowest paid workers during crises, and on occasion helped fight...

This paper reviews Iceland’s performance in skills accumulation against the backdrop of a rapidly changing economic environment and discusses directions for further improvements. Since the late 1990s, the government has considerably raised expenditure on education, which is now among the...

The Easter Island tragedy has become an allegory for ecological catastrophe and a warning for the future. In the economic literature the collapse is usually attributed to irrational or myopic behaviors in the context of a fragile ecosystem. In this paper we propose an alternative story involving...