Irish economic development over three decades of EU membership

This paper draws out lessons from Ireland's economic experience over the course of EU membership. The author starts with a description of the effects of opening up to free trade, and highlights the problems of the 1970s and 1980s that arose as a consequence of misguided fiscal policy. He then turns to the beneficial developments that paved the way to the emergence of the "Celtic Tiger" economy. EU aid alone, he argues, cannot guarantee convergence. It is likely to be of greatest benefit when the other conditions for real convergence-including a well-functioning labour market, reform-oriented microeconomic policy and macroeconomic stability - are also in place. For countries attempting to follow the Irish strategy of attracting inward FDI in high-tech manufacturing sectors, the author emphasises that low corporation-tax rates are only one part of the story. A supportive-public administration system and an abundance of human capital of the appropriate type are also key requirements.