Ireland Stat

check it out here.

From PER’s announcement:

Ireland Stat is the new pilot whole-of-Government level performance measurement website.  It aims to meet the Programme for Government commitment for accountability and transparency and to answer the question “How is Ireland doing?”

Ireland Stat presents a hierarchy of measures to show Ireland’s performance.  The website will show:

  • Achievements – what has Ireland achieved?
  • Actions – what has Ireland done?
  • Costs – what has it cost Ireland?
  • International comparisons – how is Ireland doing compared to other EU and OECD countries?
  • Trends over time – are the measures improving, staying the same or getting worse?

Ireland Stat has evolved from the Performance Budgeting process and draws on existing publicly available measures gathered from Statements of Strategy, Annual Reports, CSO, OECD, EuroStat, etc.  It brings the measures together into one website in a clear and logical way; it is based on international best practice.

Pilot website

The pilot website covers the following:

Policy areas Programmes
Economy Jobs & Enterprise Development; Innovation; Agri-food
Transport Land Transport
Environment Rural Economy; Flood Risk Management; Food Safety

Self Defeating Austerity? Not in Ireland, Apparently

Dawn Holland and Jonathan Portes present the results of their macro-econometric model of the EU in this Vox column. Specifically they argue that because of the times we live in, large scale and largely uncoordinated fiscal consolidations across the EU will lead to a collective fall in GDP and an increase in debt to GDP ratios. The increase in debt is obviously the opposite of what was intended.

The figure below shows their scenarios.

Scenario 1 is a fiscal consolidation with a working financial system, scenario 2 models a constrained financial system and so is a bit closer to reality.

Meanwhile, this paper just published in the Economic Journal (unpaygated .pdf here) tells essentially the same story using a New Keynesian model with all the bells and whistles.

Mortgage Principal Relief: Possible Lessons from the US

On the Private Debt Relief thread, commenters Brog and John Gallagher (same person?) usefully draw our attention to the debate on participation of the GSEs (Fannie Mae and Freddie Mac) in the HAMP-PRA programme (Home Affordable Modification Program – Principal Reduction Assistance).   

The federally sponsored GSEs hold a substantial fraction of US mortgages, and so their position is somewhat analogous to Ireland’s state-owned banks.   The GSEs are administered by the independent Federal Housing Finance Agency (FHFA).    John draws our attention to correspondence from the US Treasury to the agency, urging its participation in the HAMP-PRA programme.    (See here; speech by head of FHFA at the Brookings Institution here.) This program, one of a number in operation to improve the functioning of the US housing market, provides subsidies to mortgage holders for principal reductions.   The gist of the correspondence is that such reductions could, depending on the case, have a positive net present value for the owner of the mortgage.   Indeed, it is argued that the gains in NPV would more than cover the cost of the subsidy, resulting in a net gain to taxpayers.   The correspondence also discusses strategic default concerns. 

Of course, given the differences in the housing markets – e.g. the relative importance of non-recourse loans in the US – the estimations are at best suggestive for the Irish case.   But the broad approach to thinking about the issue is useful.  

One issue that is not explicitly taken into account is the possible macroeconomic benefit of facilitating household balance sheet repair.   Here again the Irish situation is different given the state creditworthiness challenge and the importance of avoiding further losses at the banks.   A programme that ends up with a net cost to the state (from combination of any subsidy and the need to inject further capital into the banks) would further erode the financial position and creditworthiness of the state.   To the extent that weaker creditworthiness (and the associated “fear of default”) feeds back to higher interest rates and lower growth this would be a macroeconomic cost.   Nevertheless, it is worth looking at how these issues are being addressed elsewhere. 

SSISI Seminar

Here are some details of an upcoming SSISI seminar.

Justin Doran, Declan Jordan and Eoin O’Leary of the UCC School of Economics are to present a paper to the Statistical and Social Inquiry Society of Ireland at the Royal Irish Academy on Dawson Street on Thursday November 1st at 6pm. The paper is called Effects of R&D spending on Innovation by Irish and Foreign-owned Businesses. Details and a draft of the paper are here.

The paper finds that Irish owned businesses are significantly more likely than foreign-owned to introduce new products as a result of creative R&D work undertaken. Foreign-owned businesses, which spend nearly six times more per worker on R&D than Irish-owned, enjoy very high returns mostly from the purchase or licence of patents. According to the authors this points to a dichotomous Irish innovation system.

An EU budget for the fifties not the future

This was the reaction of Swedish EU affairs minister Birgitta Ohlsson to the publication yesterday of the Cypriot Presidency’s revised proposal for the next EU multi-annual financial framework (MFF) covering the period 2014-2020. This is because it proposed big cuts in research and cross-border infrastructure while largely protecting the CAP budget in line with the Commission’s proposal.

The Commission has proposed a trillion euro budget (actually €1,091,551 million for EU-28 including off budget items) for the seven-year period which, depending on how the comparison is made, is seen as representing a 5% real increase in the resources available to the EU. The European Parliament, never shy about spending other people’s money, considers this a minimum amount and would prefer a higher increase. In the other arm of the budget authority, the Council of Ministers, opinions are split. The net recipients, grouped in the ‘Friends of Cohesion’ group, support the Commission proposal. The net payers, which form the ‘Friends of Better Spending’ group, want to rein back the Commission proposal to a real freeze in resources or even more. But there are differences within this group over whether the cuts should fall on the CAP or cohesion budgets (both of which are roughly 40% of the total) or on the remaining headings which account for just 20%. Not surprisingly, both the Commission and the Parliament’s Budget Committee reacted caustically to the Presidency proposal yesterday.

The Cyprus Presidency proposal explicitly sets out the implications of how a reduction in €50 billion might be made, while recognising that in the negotiating endgame further cuts will be required. The following graphic shows how it proposes the cuts should be made (all changes relative to the Commission’s revised MFF proposal in July 2012). Further details on the makeup of these figures can be found in this post.

The protection of farm spending in the EU budget emerges clearly from these figures. While in the short-run the Irish authorities will be pleased with this outcome (even if they will not state this in public, we are negotiating after all), it is worth asking whether our longer-term interests would not be better served by a budget for Europe rather than a budget for farmers.