Sharon Donnery (Deputy Governor, Central Bank of Ireland) speech on macroprudential policy

The Department of Economics, Finance & Accounting at Maynooth University welcomes Sharon Donnery, Deputy Governor of the Central Bank of Ireland, who will deliver a talk on “Building resilience in the face of uncertainty – what role for policy?”, followed by a panel discussion, chaired by Bridget McNally (Maynooth University) with panelists Robert Kelly (Central Bank, Head of Macro-Finance Division), Dermot O’Leary (Chief Economist at Goodbody Stockbrokers), and Gregory Connor (Maynooth University), on Thursday 31st May 2018,  at 11am – 12:15 pm, Renehan Hall, Maynooth University. R.S.V.P. For further information tel: 01-7083728 / 7083681

The Meeting of the Waters

The editor of Critical Quarterly bought me a drink last December and told me that he was planning a special issue on, of all things, Thomas Moore’s The Meeting of the Waters. Would I care to write an economics column on the theme?

Well, it’s one thing to write a quarterly column on whatever is interesting me at the time, another entirely to write them to order. But since we were coming up to Christmas, and since my father’s family is from Wicklow, I said yes.

You can read the result here, and while I’m not sure how much economics there is in it, I did manage to work in a reference to Sargent and Velde!

New publication from the CSO on productivity in Ireland

The CSO have a new publication, which it is intended to update annually, on productivity in Ireland.  It is available here.

The analysis assesses the contribution of labour and capital to growth in Ireland and splits the economy into an MNE-dominated sector and a domestic and other sector.  A breakdown using the standard NACE classifications is also provided.  The first publication covers the period from 2000 to 2016 but the analysis is undertaken for a number of sub-periods, most notably 2000 to 2014, which exclude the dramatic shifts we have seen since 2015.

Here is the summary but the entire publication is well worth a look:

This publication has presented new CSO results for productivity in the Irish economy since 2000. Some key aspects of this publication are set out below.

Irish labour productivity growth averaged 4.5 percent in the period to 2016, significantly for the period ending 2014 the equivalent growth rate is 3.4 percent. This compares with an EU average of 1.8 percent for the entire period to 2016. The contribution of the Foreign sector to labour productivity growth averaged 10.9 percent over the period to 2016 and averaged 6.2 percent to 2014. For the Domestic and Other sectors, the result to 2016 was 2.5 percent to 2016 and 2.4 percent to 2014. This clearly illustrates that the impact from the globalisation events of 2015 are concentrated in the Foreign sector as there is little change in the results for the Domestic and Other sector for the two periods.

Multi-factor productivity (MFP) has played a small part in explaining Ireland’s economic growth over the entire period 2000-2016. However, when the period 2000 -2014 is examined, i.e. excluding the effects of 2015, the picture for multi-factor productivity in the Irish economy improves and this is clearly illustrated in Figure 5.6 and 5.7. Growth in MFP was higher for the Foreign sector than the Domestic and Other sector up to 2014. However, the negative result for MFP in the Foreign sector in 2015 and in the overall economy over the full period is due to the impact of the globalisation events of 2015 on capital services where no corresponding change in labour input occurred. A major aspect of Ireland’s growth, and therefore its productivity story over the period, is the growth in capital.

Ireland’s capital stock per worker has increased from €150,000 to €378,000 per worker between 2000 and 2016, an increase of 152 percent. Capital stock per worker for the Foreign sector increased by an average annual growth rate of 6.9 percent to 2014. When the period is extended to 2016, the growth rate increases substantially to almost 32 percent. For the Domestic and Other sector, the growth in capital stock per worker is around 3.5 percent for both the periods to 2014 and for the entire period to 2016. The EU average annual growth in capital stocks per worker from 2000 to 2016 was 0.6 percent. The rate of increase in capital stocks in Ireland for both the Foreign sector and the Domestic and Other sector was higher than for any country in the EU for which data are available.

As this is the first productivity publication by CSO the results are considered experimental. There is considerable scope for extending the analysis presented in this publication to more detailed presentation by economic sector or to more detailed analysis of labour quality, i.e. gender, education, employment etc and their impacts on productivity. We look forward to a full engagement with our stakeholders to assist in setting priorities for future work in this area.


Conniffe and Norvartis Prizes

The annual conference of the Irish Economic Association was held on the 10th and 11th of May at the Central Bank. More than 160 people attended the conference.

Alejandra Ramos (TCD) was awarded the Conniffe Prize for best paper by a young economist at the conference. Alejandra received the prize for her paper titled “Household Decision Making with Violence: Implications for Transfer Programs”.

Benjamin Elsner (UCD) and Florin Wozny (IZA) won the Novartis prize for the best paper in Health Economics at the conference. The winning paper was titled ” The human capital cost of radiation: Long run evidence from exposure outside the womb”

Prof Wendy Carlin (UCL) and CORE gave the ESR lecture “The Econ 101 paradigm is broken – what is the alternative?” Her slides from the talk

IEA Dublin ESR Guest Lecture 2018

Prof Olivier Blanchard (Peterson Institute) gave the Edgeworth lecture “Should we reject the natural rate hypothesis” His slides from the talk

Edgeworth Lecture IEA 2018

On the IEA website there are plenty of pictures from the conference

Gerard O’Reilly