27/06/2008 : Ireland's Economic Transformation - Miracle or model?

This seminar will discuss the sources of the Irish economic "miracle", with a view to better understanding the challenges that must now be faced if the gains of the past are to be secured

The reasons behind the stellar economic performance of the Irish economy are by now well documented: a fast-growing and well-educated workforce; a business-friendly policy environment; a strong social partnership model providing for industrial stability and improvements in competitiveness. These factors have been strongly complemented through membership of the European Union by access to a large 'home' market, considerable support from structural and cohesion funds and more recently, by the commitment to a stability-oriented policy framework providing an anchor for macroeconomic and fiscal policies. After more than a decade of buoyant economic growth, per capita income in the Irish economy is now among the highest in the European Union, transforming the economic and policy-making landscape beyond recognition and allowing rapid progress on a number of economic and social fronts.

However, the economy is now facing a transition to a period of lower growth as a number of previously favourable factors unwind and new domestic and external challenges emerge. The reliance on strong domestic demand in recent years may have obscured some of the factors which underpinned the economic performance of Ireland in the last two decades, but some of these, such as low wage costs and considerable access to unused labour reserves, may no longer be relevant as sources of competitive advantage. Hence, the development model underlying Irish success may itself be in need of re-examination and reform.

The seminar will review the sources of the Irish economic "miracle", with a view to better understanding the challenges that must now be faced if the gains of the past are to be secured. The problems associated with transition to a less rapidly growing and more externally-orientated demand will be discussed, as well as the appropriate role for macroeconomic policy in a changing domestic and external environment. Finally, the seminar will address extent to which the Irish economy can be regarded as a "miracle" and therefore of limited use in terms of its lessons for other European countries, or a "model" providing a clear path towards rapid economic and social development.