Many planning regulations and multilateral funding bodies demand that developers include a Heritage Impact Assessment as part of their Environmental Impact Assessment (EIA) before approving infrastructure projects. Good developers go beyond simply completing the impact assessment and think like anthropologists, considering the cultural factors that influence their projects in the long-term. Thinking with cultural awareness often means that developers need to plan around such important cultural sites as churches and burial grounds.

Few developers, however, have ever needed to alter their development plans because of elves.

Longstanding heritage creates shared history

As odd as this may sound, Iceland — ranked in the top quintile of multiple human development indices and with the eleventh highest math literacy rate – is where these elves are influencing development projects. Yet, even though Iceland is incredibly socially progressive, it is simultaneously a culture saturated in folklore, literature, history and other old traditions. A survey conducted by the University of Iceland in 2007 found that 62% of the 1,000 respondents thought it was at least conceivable that elves do exist.

Iceland’s elves, then, serve as a shining example of the strength that cultural places have in keeping alive a history with explanations of the universe far older than indices or mathematical comprehension exams, even if the location’s value cannot be quantified or understood by the outside world.

Iceland’s geography influences cultural perceptions

Understanding the country of Iceland sheds light on how and why elves continue to persist in its modern imagination.

Iceland is a country of volcanic terrains, peppered with vast lava fields of black rocks, desert-red geothermal hot spots, geysers, and bubbling pools of sulphuric water. It is a place of cone-shaped mountains, thundering waterfalls, glaciers, crystalline lakes, lush green fields, and a coastline of windswept beaches. This reactive landscape creates the sense of a nature very much alive, and in turn a community dependent on forces far more unknowable and powerful than themselves.

Out of these meteoric phenomena, it is little surprise to folklorist Valdimar Tr. Hafstein that Icelanders fashioned the Huldufólk – or ‘Hidden People’ – which appear like human beings, yet are one with the elements of rock, hill, and pond. Huldufólk were recorded in Icelandic literature as early as the 16^th century. As Terry Gunnell, professor of Folkloristics at the University of Iceland puts it, “… everyone is aware that the land is alive, and one can say that the stories of hidden people and the need to work carefully with them reflects an understanding that the land demands respect.”

Yet, sometimes this respect for the land comes in direct conflict with cities’ need to expand.

Compromise between culture and urban expansion

Over the years, construction projects – from housing developments to new roads to factory extensions – encroaching on elf habitations were often halted or abandoned due to the reoccurrence of dream warnings, accidents, equipment failures, and ill fortunes suffered by construction workers. This has been a serious planning issue that Iceland’s communities have faced since the 1970s.

The most recent case of the conflict between elves and urban development is the road project that would link the Álftanes peninsula to Garðabær, a suburb of Iceland’s capital, Reykjavik. The project was halted by a campaign group self-named Hraunavinir (Lava friends), which believed the project would disturb the elves that lived in the lava field near the road. At the disputed site, there was also a 12-foot-high rock, an Elf Chapel, and another spot, an Elf Church, that the group did not want to see disturbed. The group teamed up with environmentalists to persuade the Icelandic Road and Coastal Commission and local authorities to abandon the project.

In December 2013, the project was brought before the Supreme Court of Iceland, which temporarily halted the project. Finally the problem was resolved in part when an Icelandic mediator communicated with the elves and negotiated an agreement, on the condition that the Elf Chapel rock was carefully moved elsewhere. The Highways authority is planning to hire a crane to move the 70-ton slab to a safer location.

Heritage and history creates more vibrant communities

To some, this negotiation with mythical creatures seems silly, but the curious case of Iceland’s elves highlights a very real need for new urban developments, and the developers that spearhead them, to understand and respect the cultural heritage of places for communities. These places stand as tangible components of a much wider, intangible tradition that links ancestors with present lives, and links the awe of a mysterious universe with a rapidly urbanizing future. These linkages between past and present, between people and place, create stronger, closer communities that are their own form of magic.

This article was originally written in London, April 2014.