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A Century of Irish Business
A potted economic history of Ireland
God save Ireland 1988
For Sale?
Aready sold (out)?
Ireland in the 20th Century
• “ It is difficult to avoid the impression that 
Irish economic performance has been the 
least impressive in Western Europe …. in the 
20th century.”
• (Lee, J.J. 1989)
Joe Lee
Indicators of economic failure
• Slow economic growth
• Low income levels
• High rate of emigration
– c. 1.5% p/a in the 50’s; tot. 150,000 emigrated
– Population decline
• c. 3000,000 in 1926
• c. 2800,000 in 1968
• c. 7000,000 in 1841
Ireland in the 40’s and 50’s
The 50’s The 40’s
The Vicious Circle of Emigration
• Few employment opportunities
• Emigration
• Decline in population
• Depressed domestic market
• Few profitable opportunities
• The socio-cultural context
• Network of social control
Population trend in 20th (and 21st*)
Century
• 1926 – c. 3000,000
• 1968 – c. 2800,000
• 1986 – c. 3500,000
• 2008 – c. 4200,000
• 2013 – c. 4600,000
Growth Rates 1926 - 2000
1926-47 1947-60 1960-80 1980-93 1993-2000
• GDP 0.9 2.3 4.1 3.3 8.3
• Population 0.0 -0.4 0.9 0.4 0.8
• GDP/capita 0.9 2.7 3.1 2.9 7.4
• Employment 0.0 -1.3 0.5 0.0 4.7
Accounting for failure
• Colonial history???
• Lack of natural resources?
• Unimaginative (poor) policy?
English Colonialism
The Irish Free State: 1922
• Some advantages
• Some early challenges
– Ireland relatively wealthy & good banking system
– Good physical & communications infrastructure
– Good civil/public service & level of education
– Civil War and damage to infrastructure
– Divided political elite
– Post WWI boom over & followed by Wall St crash 1929
– Heavy dependence on UK for trade
Group outside NUI offices 1923.
The New State - IFS
• Continuity
• Substitution of one elite for another
– New ambitious nationalist Catholic elite
• Strong link between state & Catholic Church
– Legacy of British Rule?
– The Church plays a pivotal in controlling the internal 
moral and external behaviour of the Irish citizenry –
industrial schools, Magdalene launderies, orphanages, 
Sunday Mass, the cofessional, etc.
Conservatism & the early State
• Social conservatism: a belief in traditional morality & social 
mores; a desire to preserve these often through civil law & 
regulation
• Anti-modernism
• General acceptance
• Culture of pessimism, passivity and perhaps even 
hopelessness
• Divorce, abortion, and artificial contraception, homosexuality, 
salacious books and film & theatre heavily censored
Agriculture: the dominant activity
• Farming dominated society & politics
– 32% 0f GDP & 54% of employment
• 200,000 farms between 6 & 40 hectares
• Obsession with land ownership
• 10% employed in industry
• “What was good for agriculture was good for Ireland”
Agriculture 
Ambivalent attitudes to Economic 
Development
• Policymakers objective: Rural, agrarian, Gaelic 
& Catholic
• Little investment in infrastructure
• Powerful groups interested in redistribution of 
portions of the ‘cake’ & not in making ‘cake’ 
bigger.
• Industrial development a fantasy?
Education Policy
• Controlled by church
• Circumscribed and non-technical
• Expansion resisted by Church and farming 
groups
• Failure to link education and development
• Wealthy and conservative Catholic schools 
develop the elite and exclude the 
‘undesirables’
The Impact of Emigration:
Social & Economic
• Social change deferred
• “The ‘collar’ or the dollar”
• Social unrest/revolution obviated
• Paradoxically,those who remained looked 
down on those who emigrated***
• (Today, it seems, the opinion is, rather 
strangely, reversed)
Government Policy under (Taoiseach)
Eamon de Valera
• Self-sufficiency and Protectionism
• Anglo-Irish Trade War 1932-38
• Increased tariffs
• State companies to substitute for imports
– The Sugar Company
– Bord na Mona
– The ICC
• Control of Manufactures Act 1932
• Consequence? Decline, decline, decline
Eamon deValera
Ireland post WW2
• Ireland neutral & isolated during WW2
• Total GNP declined by 16%
• Post war promotion of agriculture & 
protectionism – inefficiency
• State & Church elites disdain for innovation
• Technical backwardness
Ireland post WW2: The 50’s
• Annual growth only 1% p/a 1951-58
• Little access to private or foreign capital
• GDP per capita to 60% of European average
• 500,000 people emigrated (16% of pop.)
• Europe experienced huge economic growth 
with increased incomes, mass education, 
innovation, etc.
T.K. Whitaker – Economist & Policy-
maker
The late 50’s: The 1st Economic Turning 
Point
• T.K. Whitaker: architect of modern Irish 
economy
• Published paper “ Economic Development” 
1958
– Recommended: Export-led growth through:
– Trade liberalisation, & FDI
The Late 50’s-1st Economic Turning 
Point
Sean Lemass
• Recognised the need for 
radical change in the face of 
the 1950’s crisis.
• Drew funds from as far 
away as Australia.
1st Economic Turning Point
• Sean Lemass – New Taoiseach in 1959
• Lemass: a moderniser
• Ireland’s future in Europe
• Supported Whitaker’s expansion proposals
1958-73 Export-Led Growth & FDI
• Ireland cut tariffs
• Anglo-Irish Free Trade Agreement (1965) & GATT (1967)
• FDI promoted by subsidies & tax breaks
• Export-led growth led to an increase in GDP (4.4% p/a)
• Emigration declined and briefly ceased (Irish returnees)
• Changing attitudes to education
• Free secondary education in 1967
1973-87: Hard Times (I)
• Ireland joined the EEC on Jan. 1st 1973
• Irish expectations:
– Free trade to boost exports
– Receipt of substantial transfers/subsidies
– Decline in reliance on UK market
– Investment attracted from non-European firms 
looking for entry point to EEC
1973-87 Hard Times (II)
• 1973 – First Oil Crisis (Ireland energy 
dependent 70%)
• Recession in major economies & in Ireland
• Trade deficit, inflation and heavy borrowing
• Economy recovered by 1977 but new 
Government raised spending massively
1973-87: Hard Times (III)
• Ireland & EMS 1979
– Broke link with Sterling
– Exports to UK now only 33% of total
• Second oil crisis 1979
• Ireland borrowed even more
• 1979 – 7.3% unemployment
• 1985 – 17.4% unemployment
• GDP only 64% of European average
1988
• The Economist Headline Jan. 1988
•POOREST OF THE RICH
• Ireland a basket case
• IMF might be needed
Poorest of the Rich
1997
• The Economist Headline May 1997
• Europe’s Shining Light
Europe’s Shining Light
2010
• ‘BANAMA’ REPUBLIC
• NAMA
• The Crisis – The failure of regulation
• The failure of politicians and regulators
• The greed of bankers and developers
– Anglo-Irish Bank- Fitzpatrick
– Irish Nationwide – Finnegan
– AIB, BOI, EBS, etc
– IMF????
– Austerity, austerity, austerity.......
Unemployment
The rate The people
Agri-Food Sector in Ireland 2011
	Slide 1: A Century of Irish Business
	Slide 2: God save Ireland 1988
	Slide 3: For Sale? Aready sold (out)?
	Slide 4: Ireland in the 20th Century
	Slide 5: Joe Lee
	Slide 6: Indicators of economic failure
	Slide 7: Ireland in the 40’s and 50’s
	Slide 8: The Vicious Circle of Emigration
	Slide 9: Population trend in 20th (and 21st*) Century
	Slide 10: Growth Rates 1926 - 2000
	Slide 11: Accounting for failure
	Slide 12: English Colonialism
	Slide 13: The Irish Free State: 1922
	Slide 14: Group outside NUI offices 1923.
	Slide 15: The New State - IFS
	Slide 16: Conservatism & the early State
	Slide 17: Agriculture: the dominant activity
	Slide 18: Agriculture 
	Slide 19: Ambivalent attitudes to Economic Development
	Slide 20: Education Policy
	Slide 21: The Impact of Emigration: Social & Economic
	Slide 22: Government Policy under (Taoiseach) Eamon de Valera
	Slide 23: Eamon deValera
	Slide 24: Ireland post WW2
	Slide 25: Ireland post WW2: The 50’s
	Slide 26: T.K. Whitaker – Economist & Policy-maker
	Slide 27: The late 50’s: The 1st Economic Turning Point
	Slide 28: TheLate 50’s-1st Economic Turning Point
	Slide 29: 1st Economic Turning Point
	Slide 30: 1958-73 Export-Led Growth & FDI
	Slide 31: 1973-87: Hard Times (I)
	Slide 32: 1973-87 Hard Times (II)
	Slide 33: 1973-87: Hard Times (III)
	Slide 34: 1988
	Slide 35: Poorest of the Rich
	Slide 36: 1997
	Slide 37: Europe’s Shining Light
	Slide 38: 2010
	Slide 39
	Slide 40
	Slide 41: Unemployment
	Slide 42: Agri-Food Sector in Ireland 2011