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« Never-Ending Austerity Amidst the Ruins | Main | Bloody Disaster »

June 19, 2013

Comments

Ciaran

Careful, Michael, you're talking down the recovery there!

Thanks for this post - I think a lot of people tend to forget that Celtic Tiger consumer activity tended to be made up of wages supplemented by personal debt, rather than some outrageous burden placed on entrepreneurs as an indirect consequence of benchmarking.

By the way, which countries are among the 'small open economies' referred to in the graphs? I always wonder why we're a 'small open economy' when it suits certain Government/media spokespeople? Can we not at least call ourselves a mixed economy?

Paddy Healy

Would Irish wages not be even lower if account were taken of prices, free health provision in other jurisdictions etc

Michael Taft

Ciaran - the countries that have similar small open economies are Austria, Belgium, Denmark, Finland and Sweden. They are defined as have GDPs of less than €500 billion and exports that make up over 50% of GDP. If we are going to be lectured about what we can and can't do as a small open economy, its helpful to look at similar economies with small domestic markets.

Paddy - if PPPs were used (to take account of prices) Irish earnings would probably small marginally compared to EU averages. This is because price levels have fallen over the course of the recession.

As to factoring in public service / protection provisions - we can factor that in by reference to the social wage (i.e. what employers' pay into the social insurance fund to pay for such services). I will be looking at this hopefully next week.

Kieran Sullivan

I have to almost laugh when I hear anyone talk about 'increasing competitiveness', without mentioning 'reducing wages' in the same sentence.

It's a little like describing Ireland as 'business friendly', without considering the other side of this statement - Ireland is 'employee unfriendly'.

Ciaran

Michael, thanks for that. That's an interesting list of countries, none of which ever get name-checked by mainstream politicians /businesspeople/journalists when cheerleading public service and wage cuts by way of invocation of our status as a 'small open economy'. I wonder why this is...?

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