Iceland can consider its participation in the European Economic Area (EEA) as an associate membership of the European Union
(EU). Under the EEA agreement, Iceland participates in the EU free movement of capital, persons, services and industrial goods,
along with cooperation in social policy and related fields. However, Iceland does not participate in the EU Common Fisheries
Policy (CFP), the EU Common Agricultural Policy (CAP), the European Economic and Monetary Union (EMU), or in the EU Customs
Union. This dissertation studies the effects of full EU membership on Iceland’s Political Economy. It gives an overview of
the EU, EEA and the European Free Trade Association (EFTA), offering thorough analyses of the EMU, Agricultural Policy and
Fisheries Policy. The dissertation also reviews the pros and cons of EU membership. A decision to join the EU is in the end
a question of political choice and this dissertation is intended to make such a choice as informed as possible.
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