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Ireland and the Euro - From Boom to Bust and Beyond

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  • Donal Donovan

    (University of Limerick)

Abstract

Ireland's experience as an enthusiastic founder member of the euro area in 1999 has been characterised by several distinct phases. The initial years of membership saw a continuation of the unprecedented Celtic Tiger "boom" of the 1990s, largely driven by direct investment inflows of US multinationals. However, as the decade wore on, Irish policy makers permitted the emergence of a property bubble along with a massive surge in government expenditures. With the onset of worldwide financial turbulence in 2008, Ireland was plunged into the worst economic and financial crisis in its history, requiring an emergency bail out from the EU, the IMF, and the European Central Bank (ECB). However, following the successful implementation of the associated adjustment programme, Ireland has experienced a highly impressive economic and financial recovery. This paper reviews events leading up to and during and after the 2008/2009 crisis, with particular reference to the impact of Ireland's euro zone membership and lessons that might be drawn from this experience.

Suggested Citation

  • Donal Donovan, 2025. "Ireland and the Euro - From Boom to Bust and Beyond," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 24(4), pages 22-33.
    • Handle: RePEc:mnb:finrev:v:24:y:2025:i:4:p:22-33
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    File URL: https://hitelintezetiszemle.mnb.hu/sw/static/file/fer-24-4-st2-donovan.pdf
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    References listed on IDEAS

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    1. Honohan, Patrick & Donovan, Donal & Gorecki, Paul & Mottiar, Rafique, 2010. "The Irish Banking Crisis: Regulatory and Financial Stability Policy," MPRA Paper 24896, University Library of Munich, Germany.
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    JEL classification:

    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • F15 - International Economics - - Trade - - - Economic Integration
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management

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