Spatial Inequality in Reykjavík

Essay, 2011

30 Pages, Grade: A


Spatial Inequality in Reykjavík

“Mistakes were certainly made. The private banks failed, the supervisory system failed, the politics failed, the administration failed, the media failed, and the ideology of an unregulated free market utterly failed. This has called for a fundamental review of many elements of our society. In that respect, democracy, the rule of law and close international cooperation has been and will continue to be our strongest weapons” Prime Minister Jóhanna Sigurðardóttir reflecting on the Icelandic economic collapse, 12 April 2010.

The neoliberal experiment which was undertaken in Iceland, from the 1990s up to the financial collapse of 2008, generated unprecedented inequality not just in the country’s income distribution (Olafsson & Kristjansdóttir 2010) but in the built environment as well. This paper outlines the spatial inequality that has emerged in the city of Reykjavík and its political, economic, cultural context. Different urban artifacts are examined through Sennett’s concept of Open City, which gives us the instrument to value their spatial definition. Finally we ask ourselves whether the political revolution that followed the economic meltdown has produced signs of change in our city.


Equal is a word with multiple definitions. From the Collins English Dictionary we can read some of its meanings: 1. Having identical privileges: (all men are equal before the law) 2. Proportioned, evenly balanced. Equality therefore implies not only justice but also a state of coexistence and juxtapositions of different parts. Inequality on the other hand is a condition in which some people are more privileged than others, a condition that is out of balance. From the same source inequality is also defined as: disparity -from the Latin “disparare” that means to divide, to separate. UN-Habitat defines various forms of inequality “from different levels of human capabilities and opportunities, participation in political life, consumption and income, to disparities in living standards and access to resources, basic services and utilities” (UN-Habitat 2008, p. 51). Inequality is a division, a separation and a fracture.

I define equality as the ability to connect people to opportunities, to education, to political life, to social life, to resources, to nature and to other people; equality is about communication and understanding. Consequently spatial inequality is a fracture created by our city artifacts -buildings, infrastructures and neighbourhoods- that separate people from opportunities, nature and other people. Spatial inequality undermines the primary functions that are embedded in a public space such as communication, discussion, gossip and flirting because it divides people. It is in the mingling present in our public spaces (internet included) that we find the foundation of democracy (Sennett 2008), (Jacobs 1961), (Jacobs, Appleyard 1987).

Cities represent the most evident context in which spatial inequality can be studied, and this is not just because more than half of the world population live in them today and up to 70% of humanity will be living in them by the year 2050 (UN-Habitat 2008, p. 11), but because cities represent the world that men have fabricated (Harvey 2008). Building a city is collective effort (Rossi 1982), (Lynch 1960) and a social event (Foglesong 1995). In order to comprehend cities we need to understand the political, economic and ideological structure that have produced them (Castells 1983), (De Landa 2000), (Cuthbert 2006), (Rossi 1984), (Power & Houghton 2007). The Global Report on Human Settlements states that “Future urban planning in both developed and developing countries will be taking place in context of inequality and poverty (UN-Habitat 2009, p. 6). If inequality is a shared condition how can we plan for more equal cities? Planning is produced by us, in response to political, economic, environmental and social factors (UN-Habitat 2003), “therefore when we think of planning we should think of it as part of the production and reproduction of the social relations of power” (Foglesong 1995, p. 105). Planning is unstable, it is a constant process of redefinition of the meaning of freedom and therefore of us. It takes place on the physical stage of the city and in the virtual world of the internet. It is an ongoing process, a constant negotiation between different powers; between I and others; between my needs and society’s needs; between land as a private right and collective good (Foglesong 1995). Spatial inequality is the result of our political, economic and ideological structure, it is the result of the same forces that not just create the city but produce planning, urbanism and design. These forces are our choices (Diamond 2005) (Chang 2010).

Urbanism plays a significant role in city-making because it is a political act and a form of governance (Peñalosa 2007). With it we can design power: how much space in a road shall we allocate for cycles, for pedestrians, for cars, for busses or trees (Peñalosa 2007). How do we distribute our limited resources? How do we choose? Design is about making decisions and finding solutions that influence our society for the present and future generations. It is vital for everybody, especially, planners, architects and designers, to be able to -see- the spaces of our city and read the connections between intended and produced space, the connections between project and reality. “Thinking spatially means seeing the various politics and technologies of planning in the contextual place in society; they become examples of particular relations of power that constitute the conditions of freedom and dominance in the socially produced urban space” (Foglesong 1995, p. 105). Spatial inequality is determined by these relations of power. All the cities in the world are shaped by them; all cities are shaped by our choices.


Iceland was for a long time one of the poorest countries in Europe. In 1995 it was the 11th richest economy in the world after Luxembourg, Switzerland, Japan, Norway, Denmark, Germany, the United States, Austria, Singapore and France (Chang 2010). From the year 1998 the government decided to privatise and liberalise the financial sector, so the three state-owned banks went private (Chang 2010). Icelandic investors were nicknamed the “Viking raiders” leaded by Baugur group. In 2007 in England alone, Baugur was able to employ 65,000 people, turning over 10 billion pounds across 3,800 stores and by 2007 Iceland became the fifth richest country in the world after Norway, Luxembourg, Switzerland and Denmark (Chang 2010). In 2008 there was a meltdown in the Icelandic economy, the main banks were taken over by the state (after they all went bankrupt) and the economy shrank by 8,5% in 2009, “the fastest rate of contraction among the rich countries” (Chang 2010, p. 234). “Average gross national income fell from 1.6 times that in the United States in 2007 to 0.8 times that level in February 2009. These are measures of the calamity” (Wade 2009, p. 12).


Municipalities of the Capital Area

At the dawn of the economic boom in 1998 Reykjavík was already a city of two faces: the centre with its small coloured dwellings peppered with gardens, the main street crowded with small shops and restaurants, the whole replete with everything that a capital ought to have: embassies, parliament, ministries, museums, theatres and cinemas. On the other hand the sprawl where already 90% of the population lived.

Reykjavík centre and Reykjavík sprawl

The outside was (and still is) a landscape where any connection between buildings and roads is lost. Fragmented patches -some containing residential buildings, some containing sports areas, some office parks and shopping malls- appear as islands in a sea of motorways and greenery. The car is the dominant feature in this landscape where up to 70% of the land is used for parking spaces and other traffic related infrastructures (Sveinsson 2009).The sprawl seems to stop just where the mountains or the ocean begin. How big is Reykjavík?

The metropolitan population of Reykjavík is just over 200.000 inhabitants occupying an area of 777 km2, roughly half of the area of London that has a population 37 times bigger (Wikipedia). Reykjavík is the result of our decisions. These decisions are not always the result of a cognitive process but are very often the ad-hoc result of a multitude of acts, influenced by an ever changing political, social, and economic context.

In 1994 Ingibjörg Sólrún Gisladóttir (R-list, a left coalition) becomes the mayor of Reykjavík. The R-list started to formulate a Densification Strategy plan of the city centre; this was not just an answer to the sprawl but also an answer to the plea from the shop owners of the city centre that demanded more space for their activities –to be read as the demolition of the old houses in order to construct bigger ones-. The Densification Strategy plan remained unexpressed for nearly a decade; after all, there was very little money in the 90s to be invested in Iceland. This changed dramatically at the turn of the century, because of the government’s decision, in line with neoliberal agenda, to privatise and liberalise the financial sector - while abolishing even the most basic regulations on their activities- (Chang 2010, p. 233). Investments started to grow rapidly, money became very “cheap”, and they found the perfect ground for investment not just in downtown Reykjavík but all over the capital area and beyond. The city growth absorbed the surplus product of the financial boom (Harvey 2008). The meaning of planning changed as the politicians started to view themselves as facilitators of the private developers while wearing the robes of democratically elected represantatives of the citizens. “Porous boundaries” (Harvey 2005, p. 78) between private developers and politicians emerged with the good intention of bringing “new life” in the city centre. When the Densification Strategy plan came to implementation it turned out to have nothing to do with quality of life; improved public spaces, social equality, or a responsible environmental policy. In practice, it became a free game for investors and the construction sector (Sveinsson 2009). The residents of the city centre were excluded from the right to decide about their own city, whilst, the city politicians (our representatives) became incredibly “receptive to” the needs and priorities of the business (Sveinsson 2009). This story happened everywhere in Iceland: private developers were granted the power to make us prosper. This has been the result of our dominant view –laissez faire- the market knows best, the performance of the private sector must always be better than the one of government (Sveinsson 2009). The years that follow Gisladóttir from 2003 till 2008 are extraordinary and rather unique, these were the years of the financial boom that fuelled an unprecedented housing supply, at an utterly immoral price. At the end of 2008 three main developers owned enormous tracts of land in the city, one of them –Portus- practically owned half of the old city centre (Sveinsson 2009). All of this was done in the name of freedom, efficiency and economic growth, and it shows the danger when one idea, in this case the neoliberal one, takes over everything else. Today thousands of empty flats and unfinished projects stand all over the capital area. What spaces have we built in these years? And how do we value them?

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Spatial Inequality in Reykjavík
London School of Economics
Urban studies
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ISBN (Book)
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spatial, inequality, reykjavík
Quote paper
Massimo Santanicchia (Author), 2011, Spatial Inequality in Reykjavík, Munich, GRIN Verlag,


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