Is the celtic tiger a paper tiger?

The success of the Irish economy over the last decade has rightly attracted enormous attention from both domestic and international commentators. The remarkable phase of high economic growth rates throughout the 1990s and into the new century has led to the Irish economy being dubbed the “Celtic Tiger”, a term that has quickly been subsumed into national lexicon. Leaving aside the appropriateness of the term, the factors that have led to the significant turnabout in the economic fortunes of Ireland in a relatively short time-span deserve close scrutiny so as to inform future policy direction. The, sometimes, mocking adage attributed to economists of “that is alright in practice but how does it work in theory” may seem applicable in looking back at the recent past. There is, however, an important lesson contained within it, which is that in order to understand the course that the Irish economy is likely to follow in the future, it is necessary to identify the factors and their interactions that have led the economy to its current development stage. The aim of this discussion forum is to consider what lessons can be drawn from the Irish experience throughout the “Celtic Tiger” phase and before. The two articles that follow consider what lessons can be learnt from two perspectives. Cormac Ó Gráda poses the question of whether the Irish economy was “paper tiger” and that the rapid economic growth in the 1990s was a delayed convergence of the Irish economy after decades lagging most of Western Europe. While the delayed convergence factors are considered important the substantial changes in the Irish economy demonstrate that it is not merely a paper tiger. In contrast, Liam Gallagher, Eleanor Doyle and Eoin O’Leary consider a business model perspective, based on the work of Michael Porter, to understand the growth in the Irish economy. They examine the industrial evolution of the Irish economy to provide a framework to see the foundations of the economic success at firm, sector and national levels.2014-09-18 JG: Record reinstated from backup after damaged text_valu