Scandinavian Monetary Union after Iceland was elevated to a separate kingdom in union with Denmark in 1918. Iceland cut its ties to Denmark in 1944 and became a republic. The Icelandic króna soon became volatile, causing a high inflation and in 1980 a currency reform was introduced, in which 1 new Icelandic króna was set to 100 original ones.. The Scandinavian Monetary Union was inspired by the Latin Monetary Union, established in 1865. According to economic historians Ingrid Henriksen and Niels Kærgård:Was the Scandinavian Currency Union a success? Yes and no. When the Union functioned at its best, which was only from 1901
Economic history of Iceland the first year – 2009 – allowing fiscal multipliers to counteract the output contraction that was underway. Iceland also was not asked to downsize its Scandinavian-type welfare system." Iceland is the only country in the world to have a population under two million yet still have a floating exchange rate and an independent monetary policy. 2008 Financial Crisis and Recovery: Economic history of Iceland The economy history of Iceland covers the development of its economy from the Settlement of Iceland in the late 9th century until the present. According to a 2011 review study by economic historian Guðmundur Jónsson, "Economic