Did Recent Experience of a Financial Crisis Help in Coping with the Current Financial Turmoil? The Case of the Nordic Countries

Abstract:This article considers the lessons learned from the Nordic crises of the 1980s and 1990s and how far problems incurred during the present crisis stem from a failure to act on those lessons. Iceland, which was little affected on the first occasion, has had the worst crisis of any country round the world while Finland, which was worst affected last time, has come through almost unscathed. The ways of avoiding problems caused by having cross-border banks, a feature that did not exist on the previous occasion, were known but it has taken a second crisis to get governments to act.