Thorsteinn Thorgeirsson

Thorsteinn Thorgeirsson (born September 17, 1955 in Reykjavík, Iceland) is an Icelandic economist who has primarily worked in government and international organisations.

Career

Formerly Director-General in the Finance Ministry of Iceland,^[1] Thorgeirsson is a presently a Senior Advisor in the Central Bank of Iceland.^[2]

Prior to that, Thorgeirsson was Chief economist for the Federation of Icelandic Industries in Reykjavík 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).^[3]

Education

Thorgeirsson studied 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.

Public debate

As an economist at the OECD, Thorgeirsson was the co-author of several Economic Surveys for Finland and Norway, respectively, wherein he developed fiscal and monetary policy advice for these countries. In his capacity as chief economist for the Federation of Icelandic Industries in 2001–2004, Thorgeirsson was a participant in the debate in Iceland concerning membership in the European Union.^[4] During this time Thorgeirsson emphasised the advantages of the euro^[5] while warning about potential problems with the króna especially if monetary policy became restrictive.^[6][7] He advised the examination of other ways to adopt the euro if EU membership was a sticking point.^[8] He said the challenge for economic policy with a single European currency was overstated due to normal adjustment in a market economy.^[9] He warned against calls for a multi-currency system and advised of the benefits of the euro for financial stability.^[10] He presented an estimate of the potential benefit of EU membership for Iceland^[11] and suggested that small states benefited more from EU membership.^[12] 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.^[13] 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).^[14] 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.^[15] The Icelandic króna and the oversized banking system collapsed in the Autumn of 2008 when global financial markets seized up. While serving as Director-General in the Ministry of Finance, Thorgeirsson suggested that the efficacy of fiscal policy was underrated in the upswing while that of monetary policy was overrated.^[16] More recently, while at the Central Bank,he has written about institutional reform in financial surveillance, with a focus on macroprudential policy. He has also performed research into the policy responses to the Icelandic banking collapse, finding that the government selected the optimal path to emerge from the crisis.^[17]

Bibliography

• 2013, The Icelandic Banking Collapse: was the optimal policy path chosen? with Paul van den Noord. Central Bank of Iceland Working Paper No, 62.
• 2010, Fault lines in Cross-border Banking: Lessons from the Icelandic case, with Már Guðmundsson, SUERF Studies 05/2010.^[18]
• 2001, Increasing simplicity, neutrality and sustainability: a basis for tax reform in Iceland, with Richard Herd, OECD Econ. Dept. Working Paper No. 292, Paris, France.^[19]
• 2001, Contributions of financial systems to growth in OECD countries, with Michael Leahy, Sebastian Schich, Gert Wehinger and Florian Pelgrin, OECD Econ. Dept. Working Paper No. 280, Paris, France.^[20]
• 2000, New issues in public debt management: government surpluses in several OECD countries, the common currency in Europe and rapidly rising debt in Japan, with Paul Mylonas, Sebastian Schich and Gert Wehinger, OECD Econ. Dept. Working Paper No. 239, Paris, France.^[21]
• 1996, Maximum likelihood estimation of cointegration in exchange rate models for seven inflationary OECD countries, with David O. Cushman and Sang Sub Lee, Journal of International Money and Finance, Volume 15, Issue 3, June, Pages 337–368.^[22]

References

1. "Appointed Director-General in Ministry of Finance" (in Icelandic). Morgunblaðið. November 10, 2004. Retrieved January 12, 2012.
2. "The role of central banks in financial supervision". Sedlabanki.is. January 13, 2011. Central bank of Iceland. Retrieved January 12, 2012. Check date values in: |date= (help)
3. "Applicants for Governor of the Central Bank (in Icelandic). Web page of Prime Minister's Office" (PDF). June 24, 2009. Retrieved January 12, 2012.
4. "Small currency exposed to volatility" (in Icelandic). Morgunblaðið. November 9, 2001. Retrieved January 12, 2012.
5. "Why the euro instead of the króna?" (in Icelandic). Morgunblaðið. May 17, 2001. Retrieved January 12, 2012.
6. "What is the cost of the Icelandic króna? Annual meeting of the Tourism Association" (in Icelandic). April 2, 2003. Retrieved January 12, 2012.
7. "Billions in costs because of the króna" (in Icelandic). Morgunblaðið. April 3, 2003. Retrieved January 12, 2012.
8. "Euro without EU membership?" (in Icelandic). Morgunblaðið. June 20, 2001. Retrieved January 12, 2012.
9. Economic adjustment with the euro, Icelandic Industry. July 2002 (in Icelandic)] Archived April 29, 2009, at the Wayback Machine.
10. "A country without a legal tender?" (in Icelandic). Morgunblaðið. January 27, 2004. Retrieved January 12, 2012.
11. "The Benefit of EU membership, editorial, Icelandic Industry" (PDF) (in Icelandic). June 2002. Retrieved January 12, 2012.
12. Smaller states benefit the most from EU membership, Icelandic Industry April–May 2003 (in Icelandic) Archived October 29, 2007, at the Wayback Machine.
13. "Danger of High Interest Rates, editorial Icelandic Industry" (in Icelandic). Si.is. December 2003. Retrieved January 12, 2012.
14. "Morning news, Icelandic Broadcasting Service". Ruv.is. December 3, 2004. Retrieved January 12, 2012.
15. "Box 5: Issues of economic management during the expansion, Icelandic Economy – Autumn 2009. Ministry of Finance." (PDF). Retrieved January 12, 2012.
16. "The Challenges of Globalisation for Small Open Economies with Independent Currencies, Reykjavík, May 31 – June 1, 2007". Sedlabanki.is. June 1, 2007. Retrieved January 12, 2012.
17. "Selected the best path after the collapse (in Icelandic)". mbl.is. February 8, 2013. Retrieved May 21, 2013.
18. "2010/5 Contagion and Spillovers: New Insights from the Crisis". Suerf.org. February 12, 2010. Retrieved January 12, 2012.
19. http://www.oecd.org/dataoecd/32/3/1891991.pdf
20. http://www.oecd.org/dataoecd/38/43/1888670.pdf
21. http://www.oecd.org/dataoecd/13/42/1883831.pdf
22. "Maximum likelihood estimation of cointegration in exchange rate models for seven inflationary OECD countries. Interest rate parity and foreign exchange risk premia in the ERM". Faqs.org. Retrieved January 12, 2012.

External links

• Official site of the Central Bank of Iceland