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Ireland's Productivity Miracle - Real or Artificial?

Graham Watson

6th February 2024

This is a ToK-style article looking at the fact that Ireland is seemingly the most productive country in the world, and yet people wonder whether this is actually 'true' or not?

In drilling down into the data, it is clear that Ireland's figures, both for productivity and Gross Value Added are highly skewed by the presence of many large MNCs in and around Dublin. These companies are eight times more productive than domestic firms and contribute nearly 60% of the Gross Value Added.

So is its high productivity 'artificial'? Some would argue that if we measure GNI rather than GVA, this gives more accurate figures, and equally, the fact that the Irish tax regime is so favourable has also attracted MNCs. However, others would point out the advantages the economy has: English-speaking, well-educated and with a large number of STEM graduates.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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