From The Rise and Fall of the Danish Empire, by Michael Bregnsbo and Kurt Villads Jensen (Palgrave Macmillan, 2022), Kindle pp. 260-262:
While the eighteenth century in Denmark and Norway was considered a period of peace, progress and prosperity as reflected in expressions such as “the flourishing trade period” in Danish history and “the golden age” in Norwegian history, Iceland’s eighteenth century became a dark time. All land in Iceland was owned either by the crown, the church, or an elite mainly consisting of civil servants leasing it to the peasants: in other words, an agricultural system that did not differ much from that known in the Kingdom of Denmark. The country was characterized by social and occupational stagnation, which the trade monopoly that Iceland was subject to greatly contributed. When Bishop Ludvig Harboe 1741–1745 resided on the island, attributes of the unitary state were increasingly introduced. His work led i.e. efforts to increase the population’s literacy, but also with increased social control, i.e. restrictions on people’s right to move. But by the middle of the eighteenth century, factories were set up by Icelandic initiative, but with financial and other support from the royal power in Copenhagen, to promote Iceland’s economic and social development. These were mainly wool processing factories. However, there were many initial difficulties: deliveries did not occur, deficits necessitated large subsidies from Copenhagen, until the factories were for a time transferred to a private trading company headquartered in Copenhagen, before taken over by the state. Nevertheless, this initiative was of great importance for the modernization of Icelandic society. A factory was built near Reykjavik, and around this a settlement grew, which in 1786, when it had approx. 300 inhabitants, received a municipal charter. Iceland had thus gained its first city. The central government in Copenhagen intervened again in the early 1770s and sought to secure the social and legal rights of the peasant population vis-à-vis Iceland’s elite landowners. It was also a result of these efforts that in 1774 the state took over the monopoly of trade from a private company. 12 years later in 1786, the monopoly was abolished, trade was now free, but admittedly only to the king’s subjects. But between 1774 and 1786 something terrible also happened in Iceland. In 1783, the island was hit by a volcanic eruption that has been characterized as “one of the largest volcanic eruptions in recent millennia of Earth’s history.” (Thorsteinsson 1985, 190). Large areas were flooded by lava, toxic ash rained down over most of the island and the sky was covered with volcanic mists. All this, together with violent earthquakes, destroyed the vegetation and thus Iceland’s agriculture in the following years. It is estimated that approx. 20% of the population died as a result of these natural disasters, and a smallpox epidemic in 1785 deepened the crisis. All the previous decades’ attempts to commercially develop Iceland were now in ruins. It was in that context that the trade monopoly was abolished. The following decades saw the sale of land to tenant farmers, an action that was also done in the Kingdom of Denmark. This, too, can be seen as an attempt to bring the social and occupational structures within the Danish empire closer together, although there were undeniably large differences and the basic conditions were highly disparate. The old Althing (unicameral legislature in Iceland) was moved from the historic Tingvellir to Reykjavik in 1798, and in the year 1800 the Althing was abolished in favor of a national court and judicially trained judges. Thereby, a century-old institution had been erased. Both the move and the abolition two years later were justified with practicalities. Reykjavik was considered easier to reach than Tingvellir, and the replacement with a national court can be seen as an expression of bureaucratization and another attempt to streamline the systems throughout the different parts of the empire. Iceland in the eighteenth century came to witness first-hand the intrusive unitary state, but compared to other parts of the empire there were hardly other places where the opportunity for growth of the unitary state was greater.
