Latest Issue of the Economic and Social Review

The Economic and Social Review has just published its latest issue (Vol 48, No 4, Winter 2017)

Articles
Introduction: 50 Years of Social Research at the ESRI
Helen Russell, Emer Smyth

Non-Monetary Indicators and Multiple Dimensions: The ESRI Approach to Poverty Measurement
Dorothy Watson, Christopher T. Whelan, Bertrand Maître, James Williams

Gender Equality in the Irish Labour Market 1966-2016: Unfinished Business?
Helen Russell, Frances McGinnity, Philip J. O’Connell

Out-of-School Social Activities among Immigrant-Origin Children Living in Ireland
Merike Darmody, Emer Smyth

An Irish Solution…? Questioning the Expansion of Special Classes in an Era of Inclusive Education
Joanne Banks, Selina McCoy

Policy Section Articles
Atypical Work and Ireland’s Labour Market Collapse and Recovery
Elish Kelly, Alan Barrett

Supporting Pension Contributions Through the Tax System: Outcomes, Costs and Examining Reform
Micheál L. Collins, Gerard Hughes

A Portfolio Approach to Assessing an Auto-Enrolment Pension Scheme for Ireland
Liam A. Gallagher, Fionnuala Ryan

Irish Economic Association 2018 Conference

Irish Economic Association Annual Conference 2018

https://iea2018.exordo.com

http://www.iea.ie/

The 32nd Annual Irish Economic Association Conference will be held at the Central Bank of Ireland, New Wapping Street, North Wall Quay, Dublin 1 on Thursday May 10th and Friday May 11th, 2018. Gerard O’Reilly (Central Bank of Ireland) is the local organiser (gerard.oreilly@centralbank.ie).

The ESR guest lecture will be given by Professor Wendy Carlin (University College London and the CORE project) and the Edgeworth Lecture by Professor Olivier Blanchard (MIT and PIIE).

The Association invites submissions of papers to be considered for the conference programme. Papers may be on any area in Economics, Finance and Econometrics.

The deadline for submitted articles is the 11thof February 2018 and submissions can be made through this site.

Who is fudging? (Answer: not the EU.)

There has been a lot of talk since yesterday’s deal pointing out that there has been a certain amount of fudging going on. But there is fudge and fudge, and it’s helpful to be clear about what’s being fudged and by whom.

Paragraph 49 states:

“The United Kingdom remains committed to protecting North-South cooperation and to its guarantee of avoiding a hard border. Any future arrangements must be compatible with these overarching requirements. The United Kingdom’s objective is to achieve these objectives through the overall EU-UK relationship. Should this not be possible, the United Kingdom will propose specific solutions to address the unique circumstances of the island of Ireland. In the absence of agreed solutions, the United Kingdom will maintain full alignment with those rules of the Internal Market and Customs Union which, now or in the future, support North-South cooperation, the all-island economy, and the protection of the 1998 Agreement.”

These are commitments made by the UK to the EU and there is very little fudge here. The UK is committing as a backstop solution to the full alignment needed to “support North-South cooperation, the all-island economy, and the protection of the 1998 Agreement” in the context of an over-arching commitment to avoid a hard border. Avoiding a hard border requires full alignment for all traded goods. North-South cooperation involves the famous 142 areas of North-South cooperation we have been hearing about, and brings services like health into the mix. The all-island economy is even broader. And the Good Friday Agreement brings things like human rights into the mix.

Paragraph 50 states that:

“In the absence of agreed solutions, as set out in the previous paragraph , the United Kingdom will ensure that no new regulatory barriers develop between Northern Ireland and the rest of the United Kingdom, unless, consistent with the 1998 Agreement, the Northern Ireland Executive and Assembly agree that distinct arrangements are appropriate for Northern Ireland. In all circumstances, the United Kingdom will continue to ensure the same unfettered access for Northern Ireland’s businesses to the whole of the United Kingdom internal market.”

Notice anything? These are not commitments made by the EU. These are, once again, commitments made by the UK, in this instance to the DUP.

Paragraphs 49+50 appear to be a bit of a fudge, although the fudge can be undone by the entire UK maintaining full alignment with the EU. But let’s be clear: this is the UK fudging, not the EU, and the UK needs to fudge at this stage because of the internal contradictions of its own position. But the EU will naturally take the view that the UK must meet its commitments made to the EU in Paragraph 49. There is no fudge here: the EU has sought and obtained an impressive series of concessions from the UK, and the UK will be held to its word.

Note also that Paragraph 45 states that:

“The United Kingdom respects Ireland’s ongoing membership of the European Union and all of the corresponding rights and obligations that entails, in particular Ireland’s place in the Internal Market and the Customs Union. The United Kingdom also recalls its commitment to preserving the integrity of its internal market and Northern Ireland’s place within it, as the United Kingdom leaves the European Union’s Internal Market and Customs Union.”

These are again UK commitments, and the first of these is in the present context a commitment to respect the fact that the EU needs to police the external frontiers of its Internal Market and Customs Union. So the turning-a-blind-eye-to-smuggling non-solution is out.

And finally, note that Paragraph 46 states that:

“The commitments and principles outlined in this joint report will not pre-determine the outcome of wider discussions on the future relationship between the European Union and the United Kingdom and are, as necessary, specific to the unique circumstances on the island of Ireland. They are made and must be upheld in all circumstances, irrespective of the nature of any future agreement between the European Union and United Kingdom.”

The first sentence rules out the Brexiteers’ Baldrick-like cunning plan to use whatever special arrangements may be reached on the island of Ireland as precedents, allowing them to have their cake and eat it when it comes to the economic relationship between Great Britain and the European Union. And the second sentence commits the UK to uphold its engagements on Ireland in all circumstances.

As I say, it doesn’t seem to me as though the EU allowed much fudging when it came to the UK’s commitments to the EU regarding Ireland.

How Her Majesty’s Government simultaneously manages to meet its Paragraph 49 obligations to the EU, and its Paragraph 50 obligations to the DUP, taking account of inter alia Paragraphs 45 and 46, is something it will have to figure out. The UK government clearly ought to fulfil its commitments to the DUP, but whether it does so or not is hardly a primary concern of the EU. Paragraph 49 is what the EU will care about, not Paragraph 50. (Although Ireland would be very happy if the UK met both obligations in the only way that seems possible, namely by effectively staying in a Single Market and Customs Union type of arrangement with the EU.) If the UK wants to leave the EU in a civilised and amical manner, and strike a trade deal with the EU in the future, it will have to uphold the very clear commitments it has made to the EU. How the British deal with British fudge — whether Mrs May betrays the DUP, or abandons her previous red lines regarding membership of a customs union and the Single Market —  is a matter for them. But sooner or later they are going to be forced to confront and deal with the internal contradictions of their position.

Honest thoughts on educational inequality in Ireland

In discussing the sources of variation in academic achievement across students, there is a yawning chasm between the contemporary research literature (particularly in the emerging field of geno-economics) and the mainstream media. The mainstream media sticks religiously to the traditional blank slate theory, claiming that variation in student achievement is caused entirely by differing home and school environments. Tuesday’s Education Supplement of the Irish Times is a classic example. The main headline of the supplement is “Privately-educated elite have greater access to education” and the first paragraph reads as follows:

“Young people from disadvantaged backgrounds are denied the same opportunities as their wealthier peers, while parents with money can afford a better education for their children despite Ireland’s so-called free education system, an analysis of the 2017 Irish Times feeder school list shows.”

The article repeatedly relies on the assumption that children of wealthier parents in Ireland perform better in school for only one reason, their parents purchase better educational outcomes through fee-paying schools, tutors, and grind courses. The current scientific literature has an entirely different flavour. A recent paper by Plomin, et al., entitled “The high heritability of educational achievement reflects many genetically influenced traits, not just intelligence,” is typical. Synopsizing their findings, they state:

“Differences among children in educational achievement are highly heritable from the early school years until the end of compulsory education at age 16, when UK students are assessed nationwide with standard achievement tests [General Certificate of Secondary Education (GCSE)]. Genetic research has shown that intelligence makes a major contribution to the heritability of educational achievement. However, we
show that other broad domains of behavior such as personality and psychopathology also account for genetic influence on GCSE scores beyond that predicted by intelligence. Together with intelligence, these domains account for 75% of the heritability of GCSE scores. These results underline the importance of genetics in educational achievement and its correlates.”

To be fair to the Irish Times, an inside piece by Brian Mooney in the Supplement brings a gentle hint of realism into the blank-slate-inspired tirade of the Supplement’s lead article. Mooney hints that there might possibly be other factors explaining why households with two graduate parents grab the university places rightfully going to other households.

“For schools where both parents of many students were graduates, and where they have been supported throughout their education, getting a college place is no great reflection on the success of their school. Alternatively, we are keenly aware that for schools in disadvantaged communities, securing third-level progression for even a small proportion of students is a reflection of highly motivated teachers, and is a fantastic achievement.”

Brian Mooney does not state it explicitly, but scientists have shown definitively that the most powerful “support” that two-graduate-parent households gift to their children is their two tightly packed strands of DNA, which split and recombine, creating a new human infant in the most complex and beautiful physical process in the known universe. This new human infant is not a blank slate; he/she inherits a block-random collection of genomic traits from the maternal and paternal genomes. That genetic process, not fee-paying schools or tutor expenses, is a major source of inequality in educational outcomes in Ireland.

NB: In response to thoughtful comments from colleagues, I changed “the main source” to “a major source” in the last sentence above. That is perhaps more accurate, although it does mess with the rhythm of the final sentence. This edit was made after comments below.

Research on the ongoing resolution of the mortgage arrears crisis

A research technical paper with two associated Economic Letters were released today addressing the topic of mortgage arrears, modification, repayment, borrower engagement and loan vulnerability to future payment increases.

Research Technical Paper

EL on modification

EL on borrower engagement