The Schengen visa got its name from the Schengen Agreement of 1985 that eliminated all internal borders within most of Europe, allowing the holder of this visa to travel to most parts of the continent. As the agreement was signed in Schengen town in Luxembourg, it got its name after the place.
All of the countries, which were a party to the agreement, agreed to have only an external border, within which people are allowed to move freely. Since Bulgaria, Ireland, Romania and the United Kingdom did not sign this agreement, the visa does not allow travel to these countries. Although Liechtenstein, Switzerland Iceland and Norway are not in the EU, the Schengen visa allows travel to these countries because they signed the agreement.
The countries to which people are entitled to travel to with the Schengen Visa are Austria, Belgium, Czech Republic, Denmark, Estonia, France, Finland, Greece, Germany, Hungary, Iceland, Lithuania, Latvia, Luxembourg, Malta Norway, Poland, Portugal, Spain, Sweden , Switzerland, Slovenia, Slovakia and The Netherlands.