Governing the Irish Economy : a Triple Crisis

Dellepiane Avellaneda, Sebastian and Hardiman, Niamh (2011) Governing the Irish Economy : a Triple Crisis. In: Irish Governance in Crisis. Manchester University Press, Manchester. ISBN 978-0-7190-8223-8

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    Abstract

    The international economic crisis hit Ireland hard from 2007 on. Ireland’s membership of the Euro had a significant effect on the policy configuration in the run-­up to the crisis, as this had shaped credit availability, bank incentives, fiscal priorities, and wage bargaining practices in a variety of ways. But domestic political choices shaped the terms on which Ireland experienced the crisis. The prior configuration of domestic policy choices, the structure of decision-making, and the influence of organized interests over government, all play a vital role in explaining the scale and severity of crisis. Indeed, this paper argues that Ireland has had to manage not one economic crisis but three – financial, fiscal, and competitiveness. Initial recourse to the orthodox strategies of spending cuts and cost containment did not contain the spread of the crisis, and in November 2010 Ireland entered an EU‐IMF loan agreement. This paper outlines the pathways to this outcome.