International audience ; Abstract: In Ireland as in many other countries there has been an ongoing debate on the nature, degree and trends of regional imbalances. However, relatively little is known about the effects of policies at the regional level in Ireland. This paper considers two aspects of public policy namely the fiscal system and public expenditure. In particular regional government accounts are constructed, which identify the level of taxation, subsidisation and public expenditure at the regional level. The analysis of this data confirms that the fiscal system does reduce relative income differences in Ireland. Furthermore there are substantial resource transfers across regions.
In Ireland as in many other countries there has been an ongoing debate on the nature, degree and trends of regional imbalances. However, relatively little is known about the effects of policies at the regional level in Ireland. This paper considers two aspects of public policy namely the fiscal system and public expenditure. In particular regional government accounts are constructed, which identify the level of taxation, subsidisation and public expenditure at the regional level. The analysis of this data confirms that the fiscal system does reduce relative income differences in Ireland. Furthermore there are substantial resource transfers across regions.
The single largest project under the Irish National Development Plan (NDP) 2007-2013, is the construction of a Metro system. Despite the fact that this is the largest project under the NDP and the government's transport strategy, Transport 21, no cost benefit analysis on the project has been published. This paper aims at addressing this lack of published analysis by considering the likely economic impact one of the Metro projects, Metro-North. In doing so the paper implements two novel methods namely the use of estimates from hedonic house price models and the results from macroeconomic studies instead of the conventional cost-benefit analysis. The two methods come up with contradictory results in that the hedonic pricing methodology would suggest that the Metro-North project should not proceed while the macroeconomic approach suggests the investment should go ahead. These results are dependent on the underlying assumptions, excluded benefits and parameters used, but given the analysis in the paper alternatives can be implemented readily.
In Ireland as in many other countries there has been an ongoing debate on the nature, degree and trends of regional imbalance, which has led to substantial research output. While much is now known about these trends, the degree to which they are ameliorated by existing public policies has not been systematically examined. This paper considers two aspects of public policy namely the fiscal system and public expenditure. In particular regional government accounts are constructed, which identify the level of taxation, subsidisation and public expenditure at the regional level. These are then used to identify the degree of regional re-distribution. That analysis confirms that the fiscal system does reduce relative income differences in Ireland. Dublin and the South-West contribute to a substantial resource transfer to other regions. In contrast to the findings for the UK, the level of transfers is found to be highly related to the state of development. In other words the fiscal system works in a progressive manner in relation to regional disparities. Nevertheless the better off regions receive an above average level of expenditure so that the system only partially equalises.
read before the Society, 9th April 2020 ; This paper considers the lacklustre performance of the Northern Ireland economy in recent decades, in particular the very low productivity growth. The low level of human capital and the continued low levels of investment, account for much of this poor performance. To address its economic weakness Northern Ireland needs to reallocate resources to investment in physical and human capital over a sustained period. To date, large transfers from central government have ensured that the standard of living in Northern Ireland is close to the UK average and above that of Ireland, in spite of its weak economy. However, the dependence of Northern Ireland on these transfers leaves it very vulnerable to shocks. Because of Northern Ireland?s dependence on transfers and its weak economic structure, Irish unification, however it was handled, would be likely to be very expensive for both the Republic of Ireland and Northern Ireland.
read before the Society, 9th April 2020 ; This paper considers the lacklustre performance of the Northern Ireland economy in recent decades, in particular the very low productivity growth. The low level of human capital and the continued low levels of investment, account for much of this poor performance. To address its economic weakness Northern Ireland needs to reallocate resources to investment in physical and human capital over a sustained period. To date, large transfers from central government have ensured that the standard of living in Northern Ireland is close to the UK average and above that of Ireland, in spite of its weak economy. However, the dependence of Northern Ireland on these transfers leaves it very vulnerable to shocks. Because of Northern Ireland's dependence on transfers and its weak economic structure, Irish unification, however it was handled, would be likely to be very expensive for both the Republic of Ireland and Northern Ireland.
The UK exit from the European Union (Brexit) is likely to have a range of impacts, with trade flows one of the most immediate areas where the effects will become evident. One possible outcome of Brexit is a situation where WTO tariffs apply to merchandise trade between the UK and the EU. By examining detailed trade flows between the UK and all other EU members, matching over 5200 products to the WTO tariff applicable to external EU trade this paper shows that such an outcome would result in significantly different impacts across countries. Our estimates of exposure at the country level show an extremely wide range with reductions in trade to the UK falling by 5% (Finland) to 43% (Bulgaria) taking into account the new tariffs and the elasticity of the trade response to this price increase. Food and textiles trade are the hardest hit, with trade in these sectors reducing by up to 90%.
The UK exit from the European Union (Brexit) is likely to have a range of impacts, with trade flows likely to be most affected. One possible outcome of Brexit is a situation where WTO tariffs apply to merchandise trade between the UK and the EU. By examining detailed trade flows between the UK and all other EU members, matching over 5200 products to the WTO tariff applicable to external EU trade this paper shows that such an outcome would result in significantly different impacts across countries. Our estimates of exposure at the country level show an extremely wide range with reductions in trade to the UK falling by 5% (Finland) to 43% (Bulgaria) taking into account the new tariffs and the elasticity of the trade response to this price increase. Food and textiles trade are the hardest hit, with trade in these sectors reducing by up to 90%.
The structural fund interventions play a crucial role in improving the social and economic cohesion of the EU. A particular focus of the structural funds is on those regions that lag behind to the extent that their GDP per capita is below 75 per cent of the EU average - Objective 1 regions. In 1999 these regions accounted for 25 per cent of total EU population, and in general they are poorly endowed in a number of areas, such as infrastructure, human capital, and modern high productivity industries and services. As a consequence, they tend to have higher rates of unemployment. The amount of investment that is funded though the structural funds by the EU is substantial (?103 billion over the period 1994 to 1999 for Objective 1 regions). Given their size and significance, EU legislation requires the appraisal of the structural funds. However, while systematic monitoring and evaluation frameworks are available at the national level and at the project level, a rigorous and systematic method for quantifying the socio-economic impacts of structural fund interventions on the regional economies has not been developed to the same extent. Thus, policy-makers seldom have access to accumulated research on the macroeconomic and macro-sectoral performance at a regional (NUTS II) level, which would allow them to assess the overall impact of the structural funds. One modelling framework - HERMIN - has been widely applied to Structural Fund analysis at the national level (Greece, Ireland, Portugal, Spain, Estonia, Latvia) and macro-regional level (East Germany and Northern Ireland). In this paper we review the theoretical foundations of this modelling approach, outline its application and highlight the results from the application of the HERMIN modelling framework to structural funds evaluation. This review will highlight not only the strengths of the approach but also the weaknesses and areas for further research. The theoretical underpinning of the HERMIN model is that of a small open economy model with a Keynesian role for domestic demand. The HERMIN framework is designed as a macroeconometric model composed of four sectors: manufacturing (a mainly traded sector), market services (a mainly non-traded sector), agriculture and government (or non-market) services. This level of disaggregation is the minimum necessary to identify the key sectoral shifts in a developing (regional) economy over the years of the Structural Funds programme. The model incorporates the mechanisms through which the Objective 1 national or regional economy is inter-connected to the external world, and most importantly it incorporates mechanisms through which the Structural Funds impact on the economy in the short and long-run. It therefore captures not only the short run Keynesian demand effects but also the long-run supply side effects.
