IDEAS home Printed from
   My bibliography  Save this paper

NCC Productivity Statement 2019


  • Papa, Javier


Productivity growth is critical for enterprise competitiveness, economic growth, the financing of public services and ultimately improvements of living standards through sustainable wage levels. Aggregate labour productivity figures for Ireland continue to show a strong performance relative to other advanced economies, even when based on GNI*, which excludes globalisation activities from the data. Much of the strong performance can be attributed to the operations of large firms in specific sectors (e.g. ICT, Pharma-Chemicals, Food & Beverages) which continue to show productivity levels well above the Euro Area average. At enterprise-sectorlevel, the latest CSO figures show that in the 2000-2017 period, the annual average growth rate of labour productivity in the Foreign-owned Multinational Enterprise (MNE) dominated sector was 9.3 per cent, compared with 2.3 percent in the Domestic and Other sector, which in turn was higherthan the EU average (1.3 per cent). However, the productivity performance of the Domestic and Other sector is likely to be influenced by a number of traditionally domestic industries (e.g. Food & Beverages) which over time have shown an increasing share of foreign value added or turnover. While there is clear evidence about the direct contribution made by a highly productive and concentrated group of MNEs to the Irish economy, there is less clarity about the productivity performance of an increasingly diverse domestic sector, where both highperforming and low-performing sectors and SMEs seem to co-exist. More access to disaggregated data on productivity by size class and at enterprise level (e.g. on firm characteristics such as exporting, finance, innovation, age, human capital) would be useful for developing enterprise-policy interventions to address national needs. In terms of the indirect contribution made by MNEs, OECD research shows that domestic sourcing by foreign affiliates is relatively low in Ireland, which has consequences for knowledge, skills and ultimately productivity gains to spill over to the rest of the Irish economy, including Irish SMEs. Therefore, policies that facilitate closer economic interactions between SMEs and MNEs (via trade linkages, research collaborations and labour mobility) could help raise the productivity levels of SMEs and should be at the core of sectoral and enterprise strategy, as highlighted in Future Jobs Ireland. This statement recommends that further access to disaggregated data will help our understanding of these interactions and facilitate improvements in policy design.

Suggested Citation

  • Papa, Javier, 2019. "NCC Productivity Statement 2019," MPRA Paper 116679, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:116679

    Download full text from publisher

    File URL:
    File Function: original version
    Download Restriction: no

    References listed on IDEAS

    1. Xavier Gabaix, 2011. "The Granular Origins of Aggregate Fluctuations," Econometrica, Econometric Society, vol. 79(3), pages 733-772, May.
    2. Charles Cadestin & Koen De Backer & Sébastien Miroudot & Laurent Moussiegt & Davide Rigo & Ming Ye, 2019. "Multinational enterprises in domestic value chains," OECD Science, Technology and Industry Policy Papers 63, OECD Publishing.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Luis Pedauga & Francisco Sáez & Blanca L. Delgado-Márquez, 2022. "Macroeconomic lockdown and SMEs: the impact of the COVID-19 pandemic in Spain," Small Business Economics, Springer, vol. 58(2), pages 665-688, February.
    2. Abduraimova, Kumushoy, 2022. "Contagion and tail risk in complex financial networks," Journal of Banking & Finance, Elsevier, vol. 143(C).
    3. Petra Štamfestová & Lukáš Sobíšek & Jiří Hnilica, 2023. "Firm Size Distribution in the Central European Context," Central European Business Review, Prague University of Economics and Business, vol. 2023(5), pages 151-175.
    4. Molnárová, Zuzana & Reiter, Michael, 2022. "Technology, demand, and productivity: What an industry model tells us about business cycles," Journal of Economic Dynamics and Control, Elsevier, vol. 134(C).
    5. Peydró, José-Luis & Jiménez, Gabriel & Kenan, Huremovic & Moral-Benito, Enrique & Vega-Redondo, Fernando, 2020. "Production and financial networks in interplay: Crisis evidence from supplier-customer and credit registers," CEPR Discussion Papers 15277, C.E.P.R. Discussion Papers.
    6. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2018. "Global Firms," Journal of Economic Literature, American Economic Association, vol. 56(2), pages 565-619, June.
    7. Torsten Heinrich & Jangho Yang & Shuanping Dai, 2020. "Growth, development, and structural change at the firm-level: The example of the PR China," Papers 2012.14503,
    8. Altinoglu, Levent, 2021. "The origins of aggregate fluctuations in a credit network economy," Journal of Monetary Economics, Elsevier, vol. 117(C), pages 316-334.
    9. Hazem Krichene & Abhijit Chakraborty & Hiroyasu Inoue & Yoshi Fujiwara, 2017. "Business cycles’ correlation and systemic risk of the Japanese supplier-customer network," PLOS ONE, Public Library of Science, vol. 12(10), pages 1-22, October.
    10. Ryan A. Decker & Pablo N. D'Erasmo & Hernan Moscoso Boedo, 2016. "Market Exposure and Endogenous Firm Volatility over the Business Cycle," American Economic Journal: Macroeconomics, American Economic Association, vol. 8(1), pages 148-198, January.
    11. Campi, Mercedes & Dueñas, Marco, 2020. "Volatility and economic growth in the twentieth century," Structural Change and Economic Dynamics, Elsevier, vol. 53(C), pages 330-343.
    12. Javier Papa & Luke Rehill & Brendan O'Connor, 2021. "Patterns of Firm-Level Productivity in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 52(3), pages 241-268.
    13. di Giovanni, Julian & Levchenko, Andrei A. & Rancière, Romain, 2011. "Power laws in firm size and openness to trade: Measurement and implications," Journal of International Economics, Elsevier, vol. 85(1), pages 42-52, September.
    14. Erik Frohm & Vanessa Gunnella, 2021. "Spillovers in global production networks," Review of International Economics, Wiley Blackwell, vol. 29(3), pages 663-680, August.
    15. Nils aus dem Moore, 2014. "Taxes and Corporate Financing Decisions – Evidence from the Belgian ACE Reform," Ruhr Economic Papers 0533, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    16. Alex Nikolsko‐Rzhevskyy & Oleksandr Talavera & Nam Vu, 2023. "The flood that caused a drought," Economic Inquiry, Western Economic Association International, vol. 61(4), pages 965-981, October.
    17. Matteo Coronese & Davide Luzzati, 2022. "Economic impacts of natural hazards and complexity science: a critical review," LEM Papers Series 2022/13, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    18. Giordano, Claire & Lopez-Garcia, Paloma, 2019. "Firm heterogeneity and trade in EU countries: a cross-country analysis," Occasional Paper Series 225, European Central Bank.
    19. Fabio Ghironi, 2018. "Macro needs micro," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 34(1-2), pages 195-218.
    20. Esposito, Federico, 2022. "Demand risk and diversification through international trade," Journal of International Economics, Elsevier, vol. 135(C).

    More about this item


    Aggregate Productivity; Heterogeneity; Market Concentration; Ireland;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:116679. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.