Thorsteinn Thorgeirsson
Encyclopedia
Thorsteinn Thorgeirsson is an Icelandic economist who has been active in the discourse on domestic economic policy and currency arrangements.
in the Finance Ministry of Iceland, Thorgeirsson is a Sr. Advisor in the Central Bank of Iceland
. Prior to that, Thorgeirsson was Chief economist
for the Federation of Icelandic Industries in Reykjavik from 2001 to 2004. He was an Economist in the Economics Department of the OECD in Paris, France from 1995 to 2000. Before that, he was an economist in the Economics Department of the EFTA
in Geneva, Switzerland (1993–1995) and the Economic Department of the Central Bank of Iceland (1991–1993).
in Economics from the New School for Social Research in New York, NY, receiving the M.Phil. degree in 2005. He holds a Master of Arts
degree in Economics from Vanderbilt University
in Nashville, TN and a Bachelor of Arts
degree in Economics
from the American University in Washington DC.
. During this time he emphasised the advantages of the euro
while warning about potential problems with the króna
especially if monetary policy became restrictive. He advised to examine other ways to adopt the euro if EU membership was a sticking point. He said the challenge for economic policy with a single European currency was overstated due to normal adjustment in a market economy. He warned against calls for a multi-currency system and advised of the benefits of the euro for financial stability. He presented an estimate of the potential benefit of EU membership for Iceland and suggested that small states benefited more from EU membership. In 2003, while calling for restraint in fiscal policy, bank lending and private sector decisions, Thorgeirsson warned of an exchange rate rise and subsequent collapse of the króna following the expected high interest rate policy path of the Central Bank during a FDI
-led boom. At the same time, he suggested a moderate monetary policy path be considered (where domestic interest rates do not devitate too much from international rates). In May 2004, the central bank began to raise its policy interest rates from 5.3%, and by December 2007 it stood at 13.75%. Over this period, significant inflows of foreign capital took place, the exchange rate appreciated, bank lending surged and debt levels rose. The Icelandic króna and the oversized banking system collapsed in the Autumn of 2008 when global financial markets seized up. Thorgeirsson has also suggested that the efficacy of fiscal policy was underrated in the upswing while that of monetary policy was overrated.
Career
Formerly Director-GeneralDirector-general
The term director-general is a title given the highest executive officer within a governmental, statutory, NGO, third sector or not-for-profit institution.-European Union:...
in the Finance Ministry of Iceland, Thorgeirsson is a Sr. Advisor in the Central Bank of Iceland
Central Bank of Iceland
The Central Bank of Iceland is the central bank or reserve bank of Iceland. It has served in this capacity since 1961, when it was created by an act of the Alþingi out of the central banking department of Landsbanki Íslands, which had had the sole right of note issuance since 1927 and had...
. Prior to that, Thorgeirsson was Chief economist
Chief economist
The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis...
for the Federation of Icelandic Industries in Reykjavik from 2001 to 2004. He was an Economist in the Economics Department of the OECD in Paris, France from 1995 to 2000. Before that, he was an economist in the Economics Department of the EFTA
European Free Trade Association
The European Free Trade Association or EFTA is a free trade organisation between four European countries that operates parallel to, and is linked to, the European Union . EFTA was established on 3 May 1960 as a trade bloc-alternative for European states who were either unable to, or chose not to,...
in Geneva, Switzerland (1993–1995) and the Economic Department of the Central Bank of Iceland (1991–1993).
Education
Thorgeirsson is an ABDDoctor of Philosophy, All But Dissertation
The term all but dissertation is a mostly unofficial term identifying a stage in the process of obtaining a Doctor of Philosophy degree or equivalent research doctorate in the United States and Canada...
in Economics from the New School for Social Research in New York, NY, receiving the M.Phil. degree in 2005. He holds a Master of Arts
Master of Arts (postgraduate)
A Master of Arts from the Latin Magister Artium, is a type of Master's degree awarded by universities in many countries. The M.A. is usually contrasted with the M.S. or M.Sc. degrees...
degree in Economics from Vanderbilt University
Vanderbilt University
Vanderbilt University is a private research university located in Nashville, Tennessee, United States. Founded in 1873, the university is named for shipping and rail magnate "Commodore" Cornelius Vanderbilt, who provided Vanderbilt its initial $1 million endowment despite having never been to the...
in Nashville, TN and a Bachelor of Arts
Bachelor of Arts
A Bachelor of Arts , from the Latin artium baccalaureus, is a bachelor's degree awarded for an undergraduate course or program in either the liberal arts, the sciences, or both...
degree in Economics
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
from the American University in Washington DC.
Public discourse
In 2001-2004, Thorgeirsson was a participant in the debate in Iceland concerning membership in the European UnionEuropean Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
. During this time he emphasised the advantages of the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
while warning about potential problems with the króna
Icelandic króna
The króna is the currency of Iceland. The króna is technically subdivided into 100 aurar , but in practice this subdivision is no longer used....
especially if monetary policy became restrictive. He advised to examine other ways to adopt the euro if EU membership was a sticking point. He said the challenge for economic policy with a single European currency was overstated due to normal adjustment in a market economy. He warned against calls for a multi-currency system and advised of the benefits of the euro for financial stability. He presented an estimate of the potential benefit of EU membership for Iceland and suggested that small states benefited more from EU membership. In 2003, while calling for restraint in fiscal policy, bank lending and private sector decisions, Thorgeirsson warned of an exchange rate rise and subsequent collapse of the króna following the expected high interest rate policy path of the Central Bank during a FDI
Foreign direct investment
Foreign direct investment or foreign investment refers to the net inflows of investment to acquire a lasting management interest in an enterprise operating in an economy other than that of the investor.. It is the sum of equity capital,other long-term capital, and short-term capital as shown in...
-led boom. At the same time, he suggested a moderate monetary policy path be considered (where domestic interest rates do not devitate too much from international rates). In May 2004, the central bank began to raise its policy interest rates from 5.3%, and by December 2007 it stood at 13.75%. Over this period, significant inflows of foreign capital took place, the exchange rate appreciated, bank lending surged and debt levels rose. The Icelandic króna and the oversized banking system collapsed in the Autumn of 2008 when global financial markets seized up. Thorgeirsson has also suggested that the efficacy of fiscal policy was underrated in the upswing while that of monetary policy was overrated.