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Bringing Domestic Institutions Back into Understanding Ireland’s Economic Crisis


  • Niamh Hardiman

    (UCD School of Politics and International Relations)


The Irish economy has had one of the worst experiences of economic crisis within the EU since the onset of international financial crisis in 2007/8. That the crisis has an international dimension is beyond question. What needs to be explored further is the contribution of domestic political factors which weakened the capacity of the Irish political system to respond and which exposed Ireland to a worse crisis than might otherwise have occurred. Three institutional clusters are analysed: the political priorities and decision-making routines underlying the Irish growth model; the configuration of the public administration system; and the management of the domestic cost base. In all three, urgent priorities for reform are identified. The paper does not advocate reform of the electoral system, which tends to attract more media attention than is warranted. Rather, it argues that energy and intelligence needs to be devoted to reforming the quality of decision-making, limiting government’s fiscal discretion, and opening up transparency in the distribution of the costs of adjustment.

Suggested Citation

  • Niamh Hardiman, 2010. "Bringing Domestic Institutions Back into Understanding Ireland’s Economic Crisis," Working Papers 201042, Geary Institute, University College Dublin.
  • Handle: RePEc:ucd:wpaper:201042

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    References listed on IDEAS

    1. Gerard Caprio & Patrick Honohan, 2008. "Banking Crises," Center for Development Economics 2008-09, Department of Economics, Williams College.
    2. 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.
    3. Benetrix, Agustin & Lane, Philip R., 2009. "The Impact of Fiscal Shocks on the Irish Economy," The Economic and Social Review, Economic and Social Studies, vol. 40(4), pages 407-434.
    4. James Crotty, 2009. "Structural causes of the global financial crisis: a critical assessment of the 'new financial architecture'," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 563-580, July.
    5. Niamh Hardiman & Muiris MacCarthaigh, 2010. "Organising for Growth: Irish State Administration 1958-2008," The Economic and Social Review, Economic and Social Studies, vol. 41(3), pages 367-393.
    6. Honohan, Patrick, 2006. "To What Extent has Finance been a Driver of Ireland's Economic Success?," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), vol. 2006(4-Winter), pages 59-72.
    7. John FitzGerald, 2000. "Ireland's Failure-And Belated Convergence," Papers WP133, Economic and Social Research Institute (ESRI).
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    Cited by:

    1. Blánaid Clarke & Niamh Hardiman, 2012. "Crisis in the Irish Banking System," Working Papers 201203, Geary Institute, University College Dublin.
    2. Alan J. Kearns, 2017. "Rebuilding Trust: Ireland’s CSR Plan in the Light of Caritas in Veritate," Journal of Business Ethics, Springer, vol. 146(4), pages 845-857, December.
    3. Paul Gillespie, 2012. "At the receiving end—Irish perspectives and response to the banking and sovereign debt crises," Asia Europe Journal, Springer, vol. 9(2), pages 125-139, March.

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