Advanced Search
MyIDEAS: Login to save this paper or follow this series

From Tiger to PIIGS: Ireland and the use of heuristics in comparative political economy

Contents:

Author Info

  • Samuel Brazys

    (School of Politics and International Relations, University College Dublin)

  • Niamh Hardiman

    (School of Politics and International Relations, University College Dublin, UCD Geary Institute)

Abstract

Acronyms for groups of countries provide an often useful shorthand to capture emergent similarities, and terms such as PIIGS, BRICs and LDCs pervade the lexicon of international and comparative political economy. But they can also lead to misleading narratives, since the grounds for use of these terms as heuristic devices are usually not well elaborated. This can become problematic when the use of such heuristics drives market responses in areas such as risk perception and changes in interest rates. In this paper we look at the narrative construction of the group of countries that has been grouped as ‘PIIGS’ (Portugal, Ireland, Italy, Greece, and Spain). We examine the process whereby the group came into being, trace how Ireland became a member of this grouping, and assess the merits of classifying these countries together. Our contention is that the repetition of the acronym in public debate shaped the behaviour of market actors toward these countries. We find evidence of Granger causality, such that increased media usage of the term ‘PIIGS’ is followed by converging interest rate correlations between Ireland and the other PIIGS, compared to the interest rate correlations between Ireland and the ‘northern’ Eurozone economies. We argue that this is a pointer toward the independent effect of perceptions and discourse over economic fundamentals. We conclude with more general thoughts and cautions on the use of heuristics in comparative political economy.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.ucd.ie/geary/static/publications/workingpapers/gearywp201316.pdf
File Function: First version, 2013
Download Restriction: no

Bibliographic Info

Paper provided by Geary Institute, University College Dublin in its series Working Papers with number 201316.

as in new window
Length: 27 pages
Date of creation: 01 Oct 2013
Date of revision:
Handle: RePEc:ucd:wpaper:201316

Contact details of provider:
Postal: Arts Annexe, Belfield, Dublin 4
Phone: +353 1 7164615
Fax: +353 1 7161108
Email:
Web page: http://www.ucd.ie/geary/
More information through EDIRC

Related research

Keywords: PIIGS; interest rates; ratings agencies; media; financial crisis;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Heemeijer, Peter & Hommes, Cars & Sonnemans, Joep & Tuinstra, Jan, 2009. "Price stability and volatility in markets with positive and negative expectations feedback: An experimental investigation," Journal of Economic Dynamics and Control, Elsevier, vol. 33(5), pages 1052-1072, May.
  2. Hoelscher, Gregory, 1986. "New Evidence on Deficits and Interest Rates," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 18(1), pages 1-17, February.
  3. Pu, Xiaoling & Zhang, Jianing, 2012. "Can dual-currency sovereign CDS predict exchange rate returns?," Finance Research Letters, Elsevier, vol. 9(3), pages 157-166.
  4. Fratianni, M., 1998. "Maxi vs Mini EMU: The Political Economy of Stage III," Papers 98-003, Indiana - Center for Econometric Model Research.
  5. Mark Mason, 1994. "Elements of Consensus: Europe's Response to the Japanese Automotive Challenge," Journal of Common Market Studies, Wiley Blackwell, vol. 32(4), pages 433-453, December.
  6. Jens Hilscher & Yves Nosbusch, 2007. "Determinants of Sovereign Risk: Macroeconomic Fundamentals and the Pricing of Sovereign Debt," Money Macro and Finance (MMF) Research Group Conference 2006 114, Money Macro and Finance Research Group, revised 24 Apr 2007.
  7. George A. Akerlof, 2009. "How Human Psychology Drives the Economy and Why It Matters," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1175-1175.
  8. Stracca, Livio, 2004. "Behavioral finance and asset prices: Where do we stand?," Journal of Economic Psychology, Elsevier, vol. 25(3), pages 373-405, June.
  9. Hommes, Cars, 2011. "The heterogeneous expectations hypothesis: Some evidence from the lab," Journal of Economic Dynamics and Control, Elsevier, vol. 35(1), pages 1-24, January.
  10. John Ryan, 2009. "United Kingdom Euro Scenarios Assessed," Working Papers 2009_09, Department of Economics, University of Venice "Ca' Foscari".
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ucd:wpaper:201316. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Geary Tech).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.