When the University of Chicago professor, Robert Z Aliber, came to Reykjavik in 2007 and saw the many building cranes rising from the tiny and northernmost capital in the world, he immediately saw that the bubble was going to burst. Like most critics of Iceland's economic boom at the time, his prediction was dismissed by the whole Icelandic establishment. They claimed that Aliber, as a foreigner, didn't have a profound enough understanding of the uniqueness of the Icelandic society.

When the Icelandic Viking economy came crumbling down in the second week of October 2008, many economists started to take another look at Aliber's theory. And now their eyes are turning to the crisis in Dubai. For a while, more than a quarter of all the building cranes of the world were gathered in this small city state in the United Arab Emirates. It almost feels as though the Dubai skyscrapers are collapsing under their own weight.

It is a strange feeling to witness your country falling apart before your eyes. You first start to panic when you realise that there is nothing you can do to stop the crash. When the crisis hit Iceland's shores last year the rock of the Viking economy proved to be nothing more than clear water. Now we shall have to wait and see whether Dubai's economy is built only on sand, or if a more solid base can be found to underpin its economy.

If there is anything to be learned from Iceland's experience, then it is that authorities need to act very quickly when a financial crisis hits. The country's three main banks all fell within three consecutive days, sending a shockwave through the whole banking system in Europe. During that horrible time Iceland found itself quite alone in the world, creating a kind of bunker mentality within the country. Anything foreign started to be viewed as a potential threat. And for a while the outlook for this tiny nation in the north Atlantic seemed pretty bleak.

But now, a year on, Iceland is slowly starting to recover. Many people have surely lost a lot of money, homeowners have seen their debt rise – some are in negative equity – unemployment is up to almost 9%, the highest in the history of our young republic, and our currency's value has fallen by half from its strongest position in 2007. However, contrary to many media reports, life is gradually getting back to normal. One reason is that most Icelanders were never part of this new banking economy. Most of the Icelandic banks' operations were abroad and therefore the burden is also mostly felt overseas.

This is a big difference between Dubai and Iceland. While Dubai has been attracting foreign billionaires to buy homes on its artificial islands, the Icelandic nouveau riche had largely moved to London. Dubai has been importing billionaires; we were exporting ours. Some 85% of Dubai's population is foreign and can therefore easily leave if the country collapses. In Iceland, however, almost all of us were born here. And actually, whatever happens, most of us won't ever leave – even if we have to survive on cod liver oil.