It is not usual to point out, but worth bearing in mind, that Iceland has a total population of 320,000. This is equal to about four seats in the British House of Commons or less than half of a U.S. federal congressional district. With 63 members of the legislature, we are talking about a ratio of about 5,000 people per legislators, and with a ratio that small I would suggest it hardly matters how the legislature is chosen.

Divide the country into 63 single member districts and choose the legislators by lot from each district. Or elect a legislator of seven members using single transferable vote from a district covering the entire island, with the senior member (by either age or service) serving as the president and head of state. But in this case just about everything important would be decided by direct democracy, the legislature would be more of an executive council overseeing the administration.

With a country this small, there is scope to experiment in much more democratic systems than is the norm. But the price is that the country employs army and really depends on the goodwill of its larger neighbors and its own insignificance to maintain its independence.