Table Of ContentUNDERSTANDING IRELAND’S ECONOMIC GROWTH
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Understanding Ireland’s
Economic Growth
Edited by
Frank Barry
Senior Lecturer in Economics
Department of Economics
University College Dublin
First published in Great Britain 1999 by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG21 6XS and London
Companies and representatives throughout the world
A catalogue record for this book is available from the British Library.
ISBN 978-1-349-40747-7 ISBN 978-0-333-98505-2 (eBook)
DOI 10.1057/9780333985052
First published in the United States of America 1999 by
ST. MARTIN’S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue, New York, N.Y. 10010
Library of Congress Cataloging-in-Publication Data
Understanding Ireland’s economic growth / Frank Barry.
p. cm.
Includes bibliographical references and index.
1. Ireland—Economic conditions—1949– 2. Income distribution–
–Ireland. I. Barry, Frank, 1956–
HC260.5.U53 1999
338.9415—dc21 98–44641
CIP
Selection, editorial matter and his own text ©Frank Barry 1999
Rest of text ©Macmillan Press Ltd 1999
Softcover reprint of the hardcover 1st edition 1999 978-0-333-73362-2
All rights reserved. No reproduction, copy or transmission of this publication may be made
without written permission.
No paragraph of this publication may be reproduced, copied or transmitted save with
written permission or in accordance with the provisions of the Copyright, Designs and
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the Copyright Licensing Agency, 90 Tottenham Court Road, London W1P 9HE.
Any person who does any unauthorised act in relation to this publication may be liable to
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The authors have asserted their rights to be identified as the authors of this work in
accordance with the Copyright, Designs and Patents Act 1988.
This book is printed on paper suitable for recycling and made from fully managed and
sustained forest sources.
10 9 8 7 6 5 4 3 2 1
08 07 06 05 04 03 02 01 00 99
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Contents
Preface ix
Notes on the Contributors x
Introduction 1
Frank Barry
1 The Real Convergence of the Irish Economy and
the Sectoral Distribution of Employment Growth 13
Frank Barry, Aoife Hannan and Eric A. Strobl
2 Irish Growth in Historical and
Theoretical Perspective 25
Frank Barry
3 Indigenous and Foreign Industry: Characteristics and
Performance 45
Frank Barry, John Bradley and Eoin O’Malley
4 Fiscal Adjustment and Disinflation in Ireland:
Setting the Macro Basis of Economic Recovery and
Expansion 75
Patrick Honohan
5 The European Dimension: The Single Market and
the Structural Funds 99
Frank Barry, John Bradley and Aoife Hannan
6 Education and Growth in the Irish Economy 119
Joseph Durkan, Doireann Fitz Gerald and
Colm Harmon
7 Wage Formation and the Labour Market 137
John Fitz Gerald
8 Income Inequality in Ireland in the 1980s and 1990s 167
Tim Callan and Brian Nolan
vii
viii Contents
9 The Persistence of High Unemployment in a
Small Open Labour Market: The Irish Case 193
Brendan Walsh
Index 227
Preface
This book was commissioned when I delivered a paper to the Royal
Economic Society Conference in Stoke-on-Trent in March 1997; the
paperchartedthemassiverecentjumpinIreland’sshareofEU-bound
foreigndirectinvestment.Itwasbecomingcleartotheworldjustthen
that something quite dramatic was happening in Ireland; living stan-
dards had converged rapidly on the European average while employ-
ment, traditionally the weak point in Irish performance, had grown
even faster than in the US in recent times, and far faster than in the
UK or overall EU.
Alongsidethiseconomicsuccess,solongincoming,thereseemedto
be a strong popular interest in other aspects of Ireland. This was
reflectedinahugeincreaseintouristnumbers.Irishdancinghadjoined
IrishliteratureandIrishmusic,bothtraditionalandnot-so-traditional,
inattractinginternationalattention;theIrishfilmindustrywasboom-
ing; even the Irish soccer team had found some equally long-awaited
success, while the Eurovision Song Contest, its hour come round at
last, seemed to slouch frequently towards Ireland.
Sunder Katwala, Macmillan’s commissioning editor, felt that the
time was ripe for a book on the changing Irish economy. As the
sunshine on that mid-March morning appeared propitious, I agreed.
ThecolleagueswhomIapproachedrespondedwithenthusiasmandso
the book came together rapidly, with substantial cross-fertilisation of
ideas as the chapters were being written. My thanks to all the con-
tributorsformakingtheeditingofthisbooksuchaneasyandpleasant
task.My thanks also,for assistancewith the data,to severalpastand
presentemployeesofForfa´s(FinbarrTumelty,AidarMeylerandDenis
Slater), to William Beausang of the Department of Finance, and
especially to Fergal Shortall of the Economic and Social Research
Institute.
FRANK BARRY
ix
