In the 2013 Icelandic election the government suffered a big loss, despite having steered the country through an economic recovery while the opposition parties, generally perceived as bearing main political responsibility for the economic crisis, were re-elected into government. In this paper we argue that the effect of the economy on the vote in the 2013 election in Iceland was to place particular issues on the agenda that structured voters' retrospective and prospective evaluation of the parties' performance. We describe how the political context interacts with objective economic measures and subjective perception of the economy, with the political context as the intermediate factor between the economy and the vote. With data from the Icelandic National Election Study (ICENES), we show that parties’ perceived competence and general past performance explain vote choice for the four older parties. In addition, we show that parties’ perceived performance regarding one single issue, Icesave, which was on the agenda because of the economic crisis, explains vote choice for the two former opposition parties who entered into the new government coalition. Finally, we found that EU accession negotiations/membership, put on the agenda after the crisis as a potential long-term solution to the country’s economic volatility, predicted voter’s choice. We conclude the economic context provided opportunities for parties to engage in populist rhetoric and that the winner of the election, the Progressive Party, was perceived to be credible enough to win on economic populism.
