New business formation in a rapidly growing economy: The Irish experience

The extraordinary growth of the Irish economy since the mid-1990s - the 'Celtic Tiger' - has attracted a great deal of interest, commentary and research. Indeed, many countries look to Ireland as an economic development role model, and it has been suggested that Ireland might provide key lessons for other EU members as they seek to achieve the objectives set out in the Lisbon Agenda. Much of the discussion of Ireland's growth has focused on its possible triggers: the long term consequences of the late 1980s fiscal stabilisation; EU structural funds; education; wage moderation; and devaluation of the Irish punt. The industrial policy perspective has highlighted the importance of inflows of foreign direct investment, but a notable absence from the discourse on the 'Celtic Tiger' has been any mention of the role of new business venture creation and entrepreneurship. In this paper we use unpublished Irish VAT data for the years 1988 to 2004 to provide the first detailed look at national trends in business birth and death rates in Ireland over the 'take-off' period. We also use sub-national VAT data to shed light on spatial trends in new venture creation. Our overall conclusions are that new business formation made no detectable contribution to the acceleration of Ireland's growth in the late 1990s, although we do find evidence of spatial convergence in per capita business stocks.

New business formation in a rapidly growing economy:the Irish experience

The extraordinary growth of the Irish economy since the mid-1990s—the ‘Celtic Tiger’—has attracted a great deal of interest, commentary and research. Indeed, many countries look to Ireland as an economic development role model, and it has been suggested that Ireland might provide key lessons for other EU members as they seek to achieve the objectives set out in the Lisbon Agenda. Much of the discussion of Ireland’s growth has focused on its possible triggers: the long-term consequences of the late 1980s fiscal stabilisation, EU structural funds, education, wage moderation and devaluation of the Irish punt. The industrial policy perspective has highlighted the importance of inflows of foreign direct investment, but a notable absence from the discourse on the ‘Celtic Tiger’ has been any mention of the role of new business venture creation and entrepreneurship. In this paper we use unpublished Irish VAT data for the years 1988–2004 to provide the first detailed look at national trends in business birth and death rates in Ireland over the ‘take-off’ period. We also use sub-national VAT data to shed light on spatial trends in new venture creation. Our overall conclusions are that new business formation made no detectable contribution to the acceleration of Ireland’s growth in the late 1990s, although we do find evidence of spatial convergence in per capita business stocks.

Climate and energy scenarios for Ireland to 2050 using the Irish TIMES energy systems model

Due to growing concerns regarding the anthropogenic interference with the climate system, countries across the world are being challenged to develop effective strategies to mitigate climate change by reducing or preventing greenhouse gas (GHG) emissions. The European Union (EU) is committed to contribute to this challenge by setting a number of climate and energy targets for the years 2020, 2030 and 2050 and then agreeing effort sharing amongst Member States. This thesis focus on one Member State, Ireland, which faces specific challenges and is not on track to meet the targets agreed to date. Before this work commenced, there were no projections of energy demand or supply for Ireland beyond 2020. This thesis uses techno-economic energy modelling instruments to address this knowledge gap. It builds and compares robust, comprehensive policy scenarios, providing a means of assessing the implications of different future energy and emissions pathways for the Irish economy, Ireland’s energy mix and the environment. A central focus of this thesis is to explore the dynamics of the energy system moving towards a low carbon economy. This thesis develops an energy systems model (the Irish TIMES model) to assess the implications of a range of energy and climate policy targets and target years. The thesis also compares the results generated from the least cost scenarios with official projections and target pathways and provides useful metrics and indications to identify key drivers and to support both policy makers and stakeholder in identifying cost optimal strategies. The thesis also extends the functionality of energy system modelling by developing and applying new methodologies to provide additional insights with a focus on particular issues that emerge from the scenario analysis carried out. Firstly, the thesis develops a methodology for soft-linking an energy systems model (Irish TIMES) with a power systems model (PLEXOS) to improve the interpretation of the electricity sector results in the energy system model. The soft-linking enables higher temporal resolution and improved characterisation of power plants and power system operation Secondly, the thesis develops a methodology for the integration of agriculture and energy systems modelling to enable coherent economy wide climate mitigation scenario analysis. This provides a very useful starting point for considering the trade-offs between the energy system and agriculture in the context of a low carbon economy and for enabling analysis of land-use competition. Three specific time scale perspectives are examined in this thesis (2020, 2030, 2050), aligning with key policy target time horizons. The results indicate that Ireland’s short term mandatory emissions reduction target will not be achieved without a significant reassessment of renewable energy policy and that the current dominant policy focus on wind-generated electricity is misplaced. In the medium to long term, the results suggest that energy efficiency is the first cost effective measure to deliver emissions reduction; biomass and biofuels are likely to be the most significant fuel source for Ireland in the context of a low carbon future prompting the need for a detailed assessment of possible implications for sustainability and competition with the agri-food sectors; significant changes are required in infrastructure to deliver deep emissions reductions (to enable the electrification of heat and transport, to accommodate carbon capture and storage facilities (CCS) and for biofuels); competition between energy and agriculture for land-use will become a key issue. The purpose of this thesis is to increase the evidence-based underpinning energy and climate policy decisions in Ireland. The methodology is replicable in other Member States.

How the ship of fools was ship-wrecked - The Irish crisis and response

For a decade and half the Irish economy was the poster-boy of Europe. With substantial growth rates, an open economy, flexible labour markets and low levels of taxation, Ireland was seen as evidence of the success of neoliberal policies. Yet in the matter of a few short years Ireland has turned into a one of the peripheral black-holes (along with Greece and Portugal) that are threatening to bring down the whole Eurozone project. Given this context the paper will address two key questions. Firstly how did the much eulogised Celtic Tiger fall so far and so fast? And, secondly, what has been the government’s response to the fall and crash of the Irish economy? These two questions will be addressed through both a general historical analysis of the developments of Irish society up to the crash in 2008 and then the responses to it. Secondly by an analysis of two specific elements of that development; namely the much discussed low corporation tax rate and the failure of social housing to deliver decent affordable homes for those at the bottom of society. The third element is a review of the banking and sovereign debt crisis that led to the IMF/EU deal in November 2010 and a brief outlining of its implications for public finances, especially the question of default. The paper concludes by placing the Irish crisis in a global context.

The state and industrial policy in Ireland: a case study of the Irish pharmaceutical sector

There is renewed interest in the state's role in the economic sphere but a lack of research on the viability and employment effects of alternative economic models, in particular from a ‘liberal market economy’ perspective. This article addresses this gap in the human resource management literature by undertaking a detailed case study of industrial policy in the Irish pharmaceutical sector. The proactive and resource-intensive industrial policy adopted by the Irish government and development agencies is found to have underpinned a significant strategic upgrading in this sector of the Irish economy. In turn this has facilitated the growth of high-wage, high-skill jobs. The findings highlight the potential for an active industrial policy to promote employment upgrading in liberal market economies.

The life and death of Irish social partnership: lessons for social pacts

From 1987 to 2009, Irish social partnership operated as a national framework for industrial relations. The contribution of the article is twofold. We seek to link the institutional dynamics of social partnership with the Régulation School's notions of modes of accumulation and regimes of régulation. This framework is used to explain the rise and fall of social partnership in Ireland. We argue that the regime of social partnership in Ireland can be divided into two distinct periods. In the first, social partnership contributed positively to a benign productivity-led mode of accumulation. In the second, it lost its economic functionality due mostly to financialisation taking a grip in the Irish economy. The conclusion is that social partnership had both positive and negative features, but it is unlikely to be repeated in the foreseeable future, at least not in Ireland.

The role of supply chain management in Irish enterprise strategy development:a three-dimensional approach

The Irish economy has grown strongly in recent years. This, combined with other factors in the international trading environment, has sharpened the focus on the need for innovative strategies at a national level which can contribute positively from an enterprise strategy development perspective. As traditional manufacturing activity has migrated to lower labour cost economies questions have been raised concerning the role of supply chain management (SCM) in the evolving Irish business environment. This paper describes some of the main drivers in terms of both SCM and the changing economic and business environment. It goes on to propose a three-dimensional approach to understanding the potential role of SCM in the new scenario. This in turn informs the logistics and SCM research agenda from a national policy point of view.

Measuring the sustainability of a national economy. The application of three measures of sustainability to Ireland

An assessment of the sustainability of the Irish economy has been carried out using three methodologies, enabling comparison and evaluation of the advantages and disadvantages of each, and potential synergies among them. The three measures chosen were economy-wide Material Flow Analysis (MFA), environmentally extended input-output (EE-IO) analysis and the Ecological Footprint (EF). The research aims to assess the sustainability of the Irish economy using these methods and to draw conclusions on their effectiveness in policy making both individually and in combination. A theoretical description discusses the methods and their respective advantages and disadvantages and sets out a rationale for their combined application. The application of the methods in combination has provided insights into measuring the sustainability of a national economy and generated new knowledge on the collective application of these methods. The limitations of the research are acknowledged and opportunities to address these and build on and extend the research are identified. Building on previous research, it is concluded that a complete picture of sustainability cannot be provided by a single method and/or indicator.

The transformation of Ireland 1958 - 93: the role of ideas in punctuating institutional path dependency at critical junctures

Ireland experienced two critical junctures when its economic survival was threatened: 1958/9 and 1986/7. Common to both crises was the supplanting of long established practices, that had become an integral part of the political culture of the state, by new ideas that ensured eventual economic recovery. In their adoption and implementation these ideas also fundamentally changed the institutions of state – how politics was done, how it was organised and regulated. The end result was the transformation of the Irish state. The main hypothesis of this thesis is that at those critical junctures the political and administrative elites who enabled economic recovery were not just making pragmatic decisions, their actions were influenced by ideas. Systematic content analysis of the published works of the main ideational actors, together with primary interviews with those actors still alive, reveals how their ideas were formed, what influenced them, and how they set about implementing their ideas. As the hypothesis assumes institutional change over time historical institutionalism serves as the theoretical framework. Central to this theory is the idea that choices made when a policy is being initiated or an institution formed will have a continuing influence long into the future. Institutions of state become ‘path dependent’ and impervious to change – the forces of inertia take over. That path dependency is broken at critical junctures. At those moments ideas play a major role as they offer a set of ready-made solutions. Historical institutionalism serves as a robust framework for proving that in the transformation of Ireland the role of ideas in punctuating institutional path dependency at critical junctures was central.

Empirical analysis and improved modelling of natural gas demand in Ireland

Countries across the world are being challenged to decarbonise their energy systems in response to diminishing fossil fuel reserves, rising GHG emissions and the dangerous threat of climate change. There has been a renewed interest in energy efficiency, renewable energy and low carbon energy as policy‐makers seek to identify and put in place the most robust sustainable energy system that can address this challenge. This thesis seeks to improve the evidence base underpinning energy policy decisions in Ireland with a particular focus on natural gas, which in 2011 grew to have a 30% share of Ireland’s TPER. Natural gas is used in all sectors of the Irish economy and is seen by many as a transition fuel to a low-carbon energy system; it is also a uniquely excellent source of data for many aspects of energy consumption. A detailed decomposition analysis of natural gas consumption in the residential sector quantifies many of the structural drives of change, with activity (R2 = 0.97) and intensity (R2 = 0.69) being the best explainers of changing gas demand. The 2002 residential building regulations are subject to an ex-post evaluation, which using empirical data finds a 44 ±9.5% shortfall in expected energy savings as well as a 13±1.6% level of non-compliance. A detailed energy demand model of the entire Irish energy system is presented together with scenario analysis of a large number of energy efficiency policies, which show an aggregate reduction in TFC of 8.9% compared to a reference scenario. The role for natural gas as a transition fuel over a long time horizon (2005-2050) is analysed using an energy systems model and a decomposition analysis, which shows the contribution of fuel switching to natural gas to be worth 12 percentage points of an overall 80% reduction in CO2 emissions. Finally, an analysis of the potential for CCS in Ireland finds gas CCS to be more robust than coal CCS for changes in fuel prices, capital costs and emissions reduction and the cost optimal location for a gas CCS plant in Ireland is found to be in Cork with sequestration in the depleted gas field of Kinsale.

Spatial Allocation of Material Flow Analysis: A Geographic Information System Application of Material Flow Analysis in Ireland

This study concerns the spatial allocation of material flows, with emphasis on construction material in the Irish housing sector. It addresses some of the key issues concerning anthropogenic impact on the environment through spatial temporal visualisation of the flow of materials, wastes and emissions at different spatial levels. This is presented in the form of a spatial model, Spatial Allocation of Material Flow Analysis (SAMFA), which enables the simulation of construction material flows and associated energy use. SAMFA parallels the Island Limits project (EPA funded under 2004-SD-MS-22-M2), which aimed to create a material flow analysis of the Irish economy classified by industrial sector. SAMFA further develops this by attempting to establish the material flows at the subnational geographical scale that could be used in the development of local authority (LA) sustainability strategies and spatial planning frameworks by highlighting the cumulative environmental impacts of the development of the built environment. By drawing on the idea of planning support systems, SAMFA also aims to provide a cross-disciplinary, integrative medium for involving stakeholders in strategies for a sustainable built environment and, as such, would help illustrate the sustainability consequences of alternative The pilot run of the model in Kildare has shown that the model can be successfully calibrated and applied to develop alternative material flows and energy-use scenarios at the ED level. This has been demonstrated through the development of an integrated and a business-as-usual scenario, with the former integrating a range of potential material efficiency and energysaving policy options and the latter replicating conditions that best describe the current trend. Their comparison shows that the former is better than the latter in terms of both material and energy use. This report also identifies a number of potential areas of future research and areas of broader application. This includes improving the accuracy of the SAMFA model (e.g. by establishing actual life expectancy of buildings in the Irish context through field surveys) and the extension of the model to other Irish counties. This would establish SAMFA as a valuable predicting and monitoring tool that is capable of integrating national and local spatial planning objectives with actual environmental impacts. Furthermore, should the model prove successful at this level, it then has the potential to transfer the modelling approach to other areas of the built environment, such as commercial development and other key contributors of greenhouse emissions. The ultimate aim is to develop a meta-model for predicting the consequences of consumption patterns at the local scale. This therefore offers the possibility of creating critical links between socio technical systems with the most important challenge of all the limitations of the biophysical environment.

Fabricating Economic Development

This paper is concerned with the institutions of Irish economics; it is structured around two arguments each of which links to the thesis presented in Garvin’s Preventing the future (2004). Overall it will be demonstrated that Irish economics was shaped by intellectual trends experienced within economic thought globally as well as the social considerations that were peculiar to Ireland. The evidence presented indicates that firstly while Economic Development mattered to the Irish economy it did not matter for the reasons that most writers have suggested it did. It is argued for instance that much of the literature, regardless of academic discipline, presents the publication of Economic Development in 1958 as analogous to a “big bang” event in the creation of modern Ireland. However, such a “big bang” perspective misrepresents the sophistication of economic debates prior to Whitaker’s report as well as distorting the interpretation of subsequent developments. The paper secondly, by drawing on the contents of contemporary academic journals, reappraises Irish economic thinking before and after the publication of Economic Development. It is argued that an economically “liberal” approach to Keynesianism, such as that favoured by TK Whitaker and George O’Brien, lost out in the 1960s to a more interventionist approach: only later did a more liberal approach to macroeconomic policy triumph. The rival approaches to academic economics were in turn linked to wider debates on the influence of religious authorities on Irish higher education. Academic economists were particularly concerned with preserving their intellectual independence and how a shift to planning would keep decisions on resource allocation out of the reach of conservative political and religious leaders.