Comments on: Irish prosperity and social networks

By: Hooper Chris

Hooper Chris — Wed, 21 Jan 2004 23:51:44 +0000

Rebellion to tyrants is obedience to God.

By: Richard

Richard — Fri, 29 Aug 2003 11:37:21 +0000

My impression is that EU funding has been rather important in that it allowed Ireland to invest in certain areas of infrastructure (including things like education) while maintaining relatively low rates of income and corporation tax. It’s that particular combination, which would be difficult without the EU, that was initially important.

By: John Sheehy

John Sheehy — Wed, 27 Aug 2003 09:26:15 +0000

I wasn’t trying to say that at 1% of GDP, EU funding was irrelevant, just that it isn’t one of the two most important factors. Talking about “massive subsidies” gives the impression that Ireland has been flooded with EU funding, which is just not the case (even if signs by new motorways give the impression that it is). Inward investment, for example, your second explanation, averages 8% of Irish GDP. Put that on the scales with EU funding and you can see that the latter must have relatively (considerably) less impact. Obviously, EU funding could not have cut taxes by more than 1% of GDP either (and even that’s debatable as EU money comes with strings – “additionality”: whatever EU money is used to finance must be matched by domestic money, which puts upward pressure on government spending, paid for by taxes). Taxes in Ireland are low because it hasn’t got a big welfare state (which might also explain why it is still characterised by more social bonds than the UK - they’re more essential!) The euro has helped to fuel Ireland’s remarkable growth, but it came too late to be its cause. If that didn’t start to kick in until 1997, what’s the explanation for the previous five or more years?

By: Doug

Doug — Wed, 27 Aug 2003 08:27:33 +0000

Another possible cultural or psychological side effect of EU membership: the change in national, and sometimes personal, self-definition from a negative (not British, not English) to a positive (European).

By: Chris

Chris — Wed, 27 Aug 2003 08:10:28 +0000

“Anglo-American culture leaves little space for your romanticised view of Ireland. Not a bad thing, either.” Hmm. Whether I’m right or wrong in my observations, to say that Irish social networks are denser (for want of a better word) and more uniform than they are in England and that society seems less individualistic doesn’t seem, ipso facto, to be romanticising anything. Nor did I want to suggest that having civil society organised thusly is unqualifiedly good – such structures can exclude people (and types of people) too. (On community – see this recent post by D^2 on his other blog). On EU support – so it is less than 1% of GDP. That seems not insugnificant to me, since it isn’t like governments have the discretion to spend 100% of GDP just as they like! Given the need to spend on/upgrade infrastructure (such as roads) the availability of EU support would also permit such spending being combined by lower (than otherwise) taxation.

By: zizak

zizak — Wed, 27 Aug 2003 06:11:10 +0000

Awhile back I met a Brit resident in the U.S. and he said something like “It’s funny. The Irish have been successful everywhere they’ve migrated to, but not in Ireland”. (He meant the U.S. and Australia.) I couldn’t tell if he was expressing bigotry or sympathy.

By: James W. O'Sullivan

James W. O'Sullivan — Wed, 27 Aug 2003 02:01:07 +0000

John James’ comments, and others, relating to Ireland’s prosperity offer what I consider important supporting explanatory factors. However, there is more to the story: Since the late 1960’s, and particularly the immediate post-EU membership period of the early 70’s, the pyschology of success and confidence took hold in Dublin and a few other important urban areas. At about the same time an appreciation of the distinctive qualities and international appeal of Irish culture was evident. In short the country began to believe in and value itself. It was not so much exposure to American culture and influence, but more an acceptance of the difference of the Irish experience within the English-Speaking North Atlantic community together with the confidence that the Irish “slice” of that community occupies an assured, distinctive, niche. England too had been swept along by the American wave, but earlier than Ireland it created and emphasised its assured niche of distinctivness. Canada still struggles. Anglo-American culture leaves little space for your romanticised view of Ireland. Not a bad thing, either.

By: Henry

Henry — Tue, 26 Aug 2003 23:44:58 +0000

I’m with Chris rather than John James on the recent changes to Irish society. The changes to Dublin over the last 10 years have been extraordinary – the city has been transformed, for better or for worse, into a relatively normal West European city. But in the smaller and mid-size towns, the GAA and similar organizations still play a vital role, which hasn’t really changed that much.

By: bob mologna

bob mologna — Tue, 26 Aug 2003 23:02:48 +0000

“Is the GAA as important as it seemed?” No, much more important than that.

By: jennifer eccles

jennifer eccles — Tue, 26 Aug 2003 22:49:34 +0000

I presume the “Ireland” referred to is the Republic of Ireland. The description does not ring true for Northern Ireland.

By: Conor

Conor — Tue, 26 Aug 2003 16:34:54 +0000

Chris, I think we’ve probably got most of the “critical success factors” covered at this stage. However, nobody has mentioned membership of the euro. This did not cause the increase in living standards, but it has assisted greatly in the meteoric pace of increase in wealth. Once the markets were confident that the euro would happen and that Ireland would be a founding member, the cost of money in Ireland plummeted. Since 1999, this has fallen further. If borrowing costs are 3-4% and inflation is running at 5-6%, it doesn’t take a genius to figure that the economy will enter a feeding frenzy when real interest rates are negative. Even though all the other factors cited above may have “caused” the boom (with low personal and corporate taxes being most important), it was the monetary position the euro created that fuelled it from 1997 to 2002.

By: ttam117

ttam117 — Tue, 26 Aug 2003 16:04:21 +0000

Nothing about Hurling?

By: Doug

Doug — Tue, 26 Aug 2003 16:01:42 +0000

Chris, an interesting comparison will come from watching the Baltic republics over the next ten years or so. I’ve just come back from a trip there much like yours to Ireland – fifteen days for all three, but strongly concentrated on the rural parts (we traveled by bicycle from Vilnius to Tallinn via Klaipeda, Liepaja, Riga and Parnu). Similar sized populations, similar sense of hope invested in EU membership, possibly similar levels of subsidies. Differences may come in government effectiveness (three countries thus better for comparisons), English as a first language, proximity to global trade, and size of diaspora. Although on the latter, the proportion of diaspora persons committed to the ‘old country’ may be higher, and the percentage of re-immigrants is probably higher. Anyway, signs of improvement are already clear, especially compared with my last visit nine years ago. Grocery stores (a keen interest of bicyclers) were often better than the ones I’m forced to shop at in Munich. On the other hand, the transportation infrastructure – paved roads and train connections (two more keen interests of bikers) – lags far behind other ECE countries. By the time there are no more countries in Europe to transform, the process will probably be well understood.

By: Gabriel

Gabriel — Tue, 26 Aug 2003 14:57:59 +0000

What John James said, plus the improvements in technology to enable the education to be utilised in terms of call centres, assembly and distribution etc. As for civil society, Dublin has now probably reached Northern English levels of atomisation.

By: Val

Val — Tue, 26 Aug 2003 14:34:47 +0000

Perhaps Ireland, in its own way, is treading the path of success opened by Singapore, Hong Kong, Taiwan, Chile, New Zealand and others. Hope that “harmonization” doesn’t stop it.