There is a known problem for Volvo engine wiring
harnesses and connectors from that era. In my opinion it comes from Volvo
using undersized wire in the harness, and seems worse in long cable runs.
At least your engine
hasn't started starting itself, there are three instances (that I know of) on this forum alone of that happening.
Try activating the start relay with a hot positive from the battery
or the starter (to terminal 87 on the relay, usually). If she starts with no problem there then the issue could be anywhere from the connector in the junction box on the engine, forward. I would start at the engine connector, and working toward the instrument panel, inspect each connector closely for signs of corrosion
My bet would be on the connector where the harness plugs into the engine first, the connector where it plugs into the instrument panel second, or the ignition switch itself, but it could be just a bad start relay. Usually you can swap out the glow plug
relay to test that.