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This paper examines the impact of a monetary policy shock on output, prices and the exchange rate for Ireland during its participation in the EMS. The paper draws on recent techniques used in the structural vector autoregression literature. Results suggest that an exogenous temporary increase in the short-term interest rate leads to a decline in output and prices with the latter responding more sluggishly. In addition, a higher interest rate leads to an immediate appreciation of the domestic exchange rate and a subsequent depreciation of the currency. Exchange rate or forward bias puzzle, which are prevalent in other studies, are not found. The robustness of these results is checked under a number of alternative identifications schemes. [ABSTRACT FROM AUTHOR]

In this paper, Irish households' expenditure on prepared meals for home consumption is analysed using the 1987 and 1994 Irish Household Budget Survey datasets. The aim of the paper is to analyse the factors influencing Irish households' decisions to purchase prepared meals and how much to spend on these food items. This is done using the double-hurdle methodology adjusted for the problems of heteroscedasticity and non-normality. Income elasticities are estimated for household expenditure on prepared meals in both years and significant socioeconomic influences are identified. These socioeconomic factors are assumed to underpin the tastes and preferences of Irish households, with convenience identified as a significant preference of many household groups. [ABSTRACT FROM AUTHOR]

This paper examines the effect of changes in the Punt/Sterling exchange rate on exports from Ireland to Britain. The approach used here differs significantly from that used in most other studies in that the long-run neutrality of the Punt/Sterling exchange rate with regard to exports from Ireland to Britain is tested using a recently developed technique. There is strong evidence that the exchange rate is neutral in the long run. [ABSTRACT FROM AUTHOR]

The paper investigates the nature of Irish macroeconomic shocks and their correlation with German and UK shocks. A restricted VAR of real output and prices is employed to distinguish aggregate demand and supply shocks for the three countries. To identify the role of Irish exchange rate policy two periods are considered: the preERM period and the ERM period. The results indicate that while the change in exchange rate policy had an effect on the nature of demand and supply shocks, the ERM did not have the effect of increasing the correlation of Irish shocks with Germany or the UK. Evidence of substantial asymmetric shocks with Germany and the UK exist. Thus, Ireland as a member of the EMU faces increased cost of adjustment to asymmetric macroeconomic shocks. [ABSTRACT FROM AUTHOR]

This paper uses detailed industry-level data for the UK regions which, based on the standard cross-sectional regression model, suggests that 'strong' convergence was occurring during the period 1963-92, even though plotting these data and considering their variation over time would tend to suggest divergence rather than convergence has dominated. However, since there are several, rather fundamental drawbacks associated with the cross-sectional approach, a long time-series of data for Northern Ireland and Great Britain is used to test for convergence directly, based on testing for unit roots. The outcome is that more than half of the Northern Ireland industries considered experienced 'catch-up', while the rest (with the exception of the Textiles sector) experienced long-run convergence, i.e. they tracked their counterparts in Great Britain over the period considered. [ABSTRACT FROM AUTHOR]

On several occasions, the 1980s witnessed non-Keynesian effects of fiscal contractions. Most notably, cuts in government spending in Ireland, Denmark and Germany are known to have coincided with increases in private consumption spending. Self-fulfilling expectations about the effects of stabilization policies may explain these and a diversity of opposing experiences. This paper formulates a dynamic stochastic equilibrium model with equilibrium indeterminacy, which allows for sunspot fluctuations as well as for systematic consumption effects of government policy in either direction. Cointegration tests and Euler equation estimates suggest that the model is approximately in accord with German data. Parameter estimates imply that the non-Keynesian experiences are not due to self-fulfilling expectations but to the productivity effects of government-provided infrastructure services. [ABSTRACT FROM AUTHOR]

Multinational enterprises make use of tax havens to avoid paying corporate income taxes and this costs 100 billion USD and more in lost government revenue worldwide according to an increasing number of recent studies. None of those studies assigns these costs to industries. I aim to shed more light on this gap by using some of the best available industry-level US data to determine to what extent the location of the MNEs' profit is aligned with the location of their economic activities. My first finding is that the most important tax havens for US multinational enterprises are the Netherlands, Ireland and Luxembourg (all EU member states). Second, I systematically identify the specific industries in specific tax havens responsible for the costs, which should be useful information for tax authorities aiming to reduce tax avoidance. Finally, I argue that the current data are not detailed enough to provide a reliable industry breakdown of the costs, but the prospect of combining input-output tables with forthcoming country-by-country data seems more promising. [ABSTRACT FROM AUTHOR]

One way of measuring the deprivation or poverty of persons is to use money based measures: a person is regarded as 'poor' if his/her income (or expenditure) falls below a poverty line value. Such an approach-usually termed 'poverty analysis'-has spawned a large literature embodying several sophisticated measures of poverty. The downside to this is that low income or expenditure may not be very good indicators of deprivation. Another way, usually termed 'deprivation analysis', is to define an index whose value, for each person, is the number (or proportion) of items, from a prescribed list, that he/she possesses: persons are then regarded as 'deprived' if their index value is below some threshold value. This offers an alternative method of identifying deprived persons. The downside of deprivation analysis is that it measures deprivation exclusively in terms of the proportion of deprived persons in the total number of persons. The purpose of this paper is to bridge the gap between poverty and deprivation analysis by constructing a wider set of deprivation measures and showing, with data for Northern Ireland, how they might be applied. [ABSTRACT FROM AUTHOR]

This paper presents a dynamic form of the Almost Ideal Demand System (AIDS). Three versions of the static AIDS model are employed to determine the preferred long-run equilibrium model and represents the short-run dynamics by an error correction mechanism. This estimation procedure is then applied to alcohol expenditure in Ireland. The estimated point elasticities are consistent with previous studies and a priori expectations. Beer and spirits are found to be price inelastic in both the short and long run. While wine is price inelastic in the short run and price elastic in the long run. [ABSTRACT FROM AUTHOR]

The recent establishment of regional assemblies adds a further policy dimension to higher education. This paper consists of an empirical analysis of the choices made by the 1991 Northern Ireland cohort of entrants to higher education to stay in or leave Northern Ireland for universities and subsequently then for employment. The data indicate that the probability to leave was firmly linked to A level scores, though this interacted with religion and social class. The choice of labour market for most students reflected the location of university. Those who returned to Northern Ireland after graduation were less able and earned less on average than those who remained. Employment in the locality of the university improves earnings, possibly due to the information this generates for both parties. [ABSTRACT FROM AUTHOR]

In a series of studies, Bain and Elsheikh (see in particular their 1976 and 1982 publications) have used a simple econometric model to analyse the determinants of the rate of growth of trade union membership in a wide range of countries.[1] In an alternative, but closely related, study of the UK data, Burkitt and Bowers (1978) specified and found empirical support for an additional hypothesis concerning the relationship between the rate of union growth and profits. In this paper we report the results which were obtained when a 'profits augmented' version of the Bain and Elsheikh model was estimated against post-war Irish data. Our findings show that profits exerted a highly significant positive influence on Irish union growth.
The paper is organized as follows: in Section II, the principal hypotheses of the Bain and Elsheikh model are sketched out and, in Section III, the profits hypothesis is discussed. Section IV reports and discusses the results which were obtained when the resulting profits augmented version of the model was estimated against data relating to the Republic of Ireland over the period 1943 to 1977, and in the final section, the main findings of the paper are summarized. [ABSTRACT FROM AUTHOR]

The theoretical framework assumes that Irish importers and exporters operate in perfectly competitive markets for labour and capital and final output, but may face downward-sloping demand curves in the purchase and sale of imports and exports (all of which are assumed to be intermediate goods--a not unrealistic assumption given the category of traded goods considered in this paper, namely manufactured goods in the Standard International Trade Classification 5-8 inclusive). The exporters exploit this monopolistic power to charge what the market will bear and thus the price of exports deviates from the competitive price by an amount that can be estimated. An analogous argument holds for importers. As a by-product of this exercise several other important coefficients relating to the domestic technology are also estimated.
The plan of the paper is as follows. Section II briefly outlines the Appelbaum-Kohli theoretical model. Section III presents the final forms of the export and import models to be estimated. Section IV reports the results of estimating the respective models using both quarterly and semi-annual data. Finally, Section V contains some comments on the implications of the results and some concluding remarks. [ABSTRACT FROM AUTHOR]

Evaluation should consider what would have happened in the absence of assistance. To produce an assessment of this counter-factual scenario involves considering the twin concepts of deadweight and displacement. An evaluative framework is developed for measuring the impact of grant assistance to individual firms. Logit regression analysis is used to estimate predictive models for deadweight and displacement. The data were gathered during face-to-face interviews with the managing directors of firms that received grants from Shannon Development in the Shannon region of Ireland (self-assessment approach). The objective was to establish whether certain characteristics of grant-assisted firms can predict probable deadweight and displacement effects. In the case of deadweight, it was found that grant type, size of firm, whether investment appraisal carried out by firm included grant received and whether firm was a first-time or repeat grant recipient all impact on the level of deadweight. Regarding displacement, it was found that size of firm and type of ownership impact on displacement. While the evaluative framework has been 'tested' in an Irish regional context, the logic of the approach is clear and has a much wider international applicability regarding the evaluation of industrial policy interventions. [ABSTRACT FROM AUTHOR]

Smooth adjustment to real exchange rate shifts is one of the major challenges facing the Irish economy under EMU. Rather than assume purchasing power parity, the long-run real exchange rate is modelled as time-varying, being determined by relative output levels, the terms of trade and the net foreign asset position. It is shown that these factors account for a large proportion of the long-run movement in the Irish real exchange rate. [ABSTRACT FROM AUTHOR]

This study suggests a new approach towards measuring the indirect employment effects of multinational companies (MNCs) using a simple Cobb-Douglas production function. Based on the assumption that domestic sales by indigenous firms in a sector are supplies for multinationals in that sector rather than final goods, indirect employment effects are measured as the effect of an increase in domestically purchased inputs on employment in indigenously-owned suppliers. Applying this measure to data for the electronics sector in Ireland we find that there have been positive indirect effects of MNCs on employment in indigenous firms. The value of the estimated coefficients depends somewhat on the specification of the model estimated but the standard specification suggests that a 10% increase in domestically sold output by indigenous firms leads to an employment growth of around 2% in these firms. [ABSTRACT FROM AUTHOR]

Part-time work (often defined as less than 30 hours per week paid employment) has increased in recent decades, along with the growth in female participation in the labour force. The majority of part-timers tend to be women (particularly older, married women), and part-time jobs are usually observed in distinct segments of the labour market where skill levels (and other human capital attributes associated with primary labour markets) tend to be low. Consequently, part-time earnings are expected to be lower than those paid to full-time workers. This paper makes use of a particularly appropriate data source, the New Earnings Survey, to examine the relative earnings of part-time female workers in Northern Ireland over the period 1972-84. Use is then made of a special (voluntary) return attached to the 1987 NES to consider the determinants of individual employment status (part-time versus full-time) and the earnings of both categories of female workers. Following the regression work, it is then possible to estimate the full-time/part-time earnings gap, after controlling for the composition of the workforce across the two groups. The 1972-84 figures show that, over time, an initial earnings gap of over 16% in favour of full-time workers closed to around 6% (in 1980), before rising again to almost 11% by 1984. The 1987 NES data gave an estimated average wage differential of 19% for full-timers. However, the observed average differential paid in the market place was only 9%, which suggests that part-time workers are more productive (and this reduces the impact of the full-time mark-up). [ABSTRACT FROM AUTHOR]

The paper briefly considers problems associated with rational expectations and formulates a more general model which allows for situations where economic agents do not immediately arrive at a fully rational solution. It incorporates a learning mechanism whereby agents can provisionally adopt hypothetically-derived expectations as a basis for comparison with the actual outturns. Utilizing the resultant past expectational errors as indicators of the likelihood of prospective future outcomes, agents make explicit allowance a rational solution. Thus, in situations where complete information is not freely available, rationality would be approximated over time by means of a dynamic learning process which is founded on a firm empirical approach. This essential empiricism requires that the problem be examined on the basis of direct observation of applied situations. Therefore the method is implemented and analyzed with reference to Irish foreign trade in fat cattle, carcase and processed beef. Simultaneous equation models are specified for each of these markets and are tested econometrically for the period 1974-83. The results obtained indicate that the originally-derived estimates of rational expectations did not prove significant, while learning expectations overall mostly did so. In particular the expectational errors were highly significant where the markets were most volatile, i.e. in those for fat cattle and carcase beef. [ABSTRACT FROM AUTHOR]

The existence of dynamic loan market disequilibrium may have considerable implications for the way in which the loan rate of interest affects components of aggregate demand, including inventory demand. One major implication is that the loan rate may have an asymmetrical effect on components of aggregate demand, depending upon whether dynamic excess demand or supply prevails in the credit market. In a model of inventory investment estimated with quarterly data for Ireland, this asymmetrical influence of the loan rate on inventory demand is accounted for with pleasing results. This will hopefully contribute to resolving the above-mentioned puzzle relating to the effects of the loan interest rate on inventory investment.
The structure of the paper is as follows. Section II outlines very briefly the approach to credit market disequilibrium estimation used. In Section III the introductory speculations as to why so many researchers have found financial carrying costs of inventories to be unimportant are elaborated. In Section IV a structural model of inventory behaviour is presented and its reduced form is derived. The empirical results are presented in Section V, whilst Section VI contains an overview and some policy conclusions. [ABSTRACT FROM AUTHOR]

This article examines the scale of hidden underemployment on Irish farms from 2002 to 2011. We provide a measure of hidden underemployment that is not captured by the national-level statistics. Hidden underemployment can be attributed to a number of factors relating to inadequate employment situations as described at the 16th International Conference of Labour Statisticians such as low productivity, the poor utilization of skills and other factors specific to agriculture. We place particular attention upon the potential role of off-farm labour supply in solving the underemployment problem. We utilize a two-stage residual inclusion model and a random effects probit model to examine the forces behind farm underemployment. We utilize a fixed effects model to examine the factors driving the severity of farm underemployment. Our findings suggest that instances of hidden underemployment increased between 2002 and 2011. Hidden underemployment appears to be a stubborn problem and is related to the absence of off-farm employment, low yield, livestock intensity and smaller than average farm size in the sheep and drystock cattle sectors in particular. [ABSTRACT FROM AUTHOR]

Part-Time (PT) work is viewed as a viable option for people who wish to have a gradual transition to retirement. From a policy viewpoint, this may help to alleviate some labour supply shortages and fiscal pressures, especially in the context of the ageing population. Factors such as health or pension provision may influence a person's decision to work PT. This article considers the impact of health on the work decision of people aged 50 and over in the UK and Ireland. Methodological issues are discussed and the impact of unobserved individual effects is estimated using the Mundlak (1978) estimator applied to the multinomial probit model. We find that health problems increase the probability of retirement for this age group in both countries. In Britain, those with health problems are less likely to work full time and more likely to work PT, however in Ireland, health problems appear to have no effect on the probability of PT work. This article discusses the potential reasons for these impacts and current policies on PT work. [ABSTRACT FROM AUTHOR]

This article compares standard stochastic frontier models for panel data with a number of recently developed models which attempt to control for unobserved heterogeneity in the inefficiency component. Results are used to construct a generalized Malmquist Total Factor Productivity (TFP) index for the Irish tillage sector. While our application yields similar general TFP trends across models, it is evident that this new class of model leads to fewer theoretical inconsistencies in the production frontier. Furthermore, inefficiency estimates across models are critically compared and the potential benefits of controlling for unobserved heterogeneity are highlighted. [ABSTRACT FROM AUTHOR]

Using nominal and real exchange rates for Ireland relative to Germany and the UK from 1975 to 2003, this article explores likely sources of nonlinearity in Purchasing Power Parity (PPP) relationships and difficulties in employing an I(1)/I(0) econometric framework. Tests for fractional integration and nonlinearity, including random field regression-based procedures, are applied. Results reveal shortcomings in the standard cointegration and smooth transition autoregression approaches to modelling, and point to multiple structural changes models. Such a model for the case of Ireland and Germany suggests that PPP holds not only in the long-run but also in the medium to short term. [ABSTRACT FROM AUTHOR]

Ireland has participated in two currency unions-a bilateral union with the UK that lasted until 1979 and as a founder member of European Monetary Union (EMU) that began in 1999. This article investigates whether currency unions have influenced Irish trade patterns. [ABSTRACT FROM AUTHOR]

The objective of this article is to analyse the consumption behaviour of foreign tourists in Ireland. Based on the Almost Ideal Demand System, five demand systems are estimated, four representing the major source markets of tourists to Ireland, namely from Britain, North America, Mainland Europe and Rest of the World; and one aggregate model based on a pooled sample. Each system included six commodity aggregates representing the major consumables of tourists. Estimated models were statistically significant and the derived elasticities are theoretically consistent and empirically plausible. While there are some variations in the consumption patterns of tourists from different source markets, reflecting differences in consumer preferences and consumption habits, in general, tourist demand for the various Irish tourism goods and services is found to be price inelastic. This finding is consistent with a priori expectations, as tourists are obliged to consume whatever is available at the destination they visit. The lack of substitutes and perfect information on product markets offer limited consumption opportunities for the tourists. Nonetheless, the cross-price elasticity values for all commodities across the source markets indicate gross complementarity, which suggests that latent price sensitivity exists in the background. This is an area that needs further investigation and this finding may have significant, yet unknown, consequences for repeat visitation. [ABSTRACT FROM AUTHOR]

Modelling efficiency in healthcare with stochastic production frontiers (SPF) is complicated because of the immeasurable elements, quality of care and casemix as well as complex data structures. This analysis considers a SPF approach to estimating efficiencies for organizations in the Republic of Ireland that supply GP services outside of normal working hours. These organizations are run out of a number of primary care centres. The daily payroll for the centre is the output in the SPF and the services offered by these centres enter the production function as inputs. It is argued that these services are exogenous variables and are determined by patient characteristics and reported conditions and not the staff within the centre. A characteristic of the data used is a two-tier structure emanating from a centre lying within a co-op. To account for this tier structure the analysis considers a random parameters approach. The analysis also considers proxies for quality of care and casemix and incorporates them into the SPF. The sensitivity of efficiency values to the excluding the random parameters, quality of care and casemix variables is examined by estimating three reduced forms of the model which ignore each of these elements. [ABSTRACT FROM AUTHOR]

Economic thought has often regarded business cycles as asymmetric. This study examines the existence of asymmetries over the business cycle in seven European countries: France, Germany, Ireland, Italy, Luxembourg, The Netherlands and the United Kingdom. To analyse this issue, industrial production in these countries from 1957 to 1998 is examined, and quarterly contractions and expansions in this variable are compared. The results obtained with both parametric and non- parametric methods allow the existence of asymmetries in these countries to be questioned. [ABSTRACT FROM AUTHOR]

As a further contribution to the growing international literature on exchange rate pass-through (PT), this study assesses the extent of PT for Irish import prices over the period 1963 to 1995. It fills two important gaps in the literature, by making due allowance for the time series properties of the data and by concentrating on the case of a small open economy. In order to assess the extent of PT a mark-up model for aggregate import unit values is employed. It is argued that the usual single equation mark-up estimation technique leads to seriously biased and inefficient estimates of the degree of PT, as it ignores the strong simultaneity of import prices and domestic competing prices. This study makes use of the Johansen technique to allow for such simultaneity and uncovers two long-run equilibrium relationships among the data, for import unit values and domestic competing prices, and confirms the existence of very close to full PT for both. Previous results in the literature demonstrating substantially less than full PT may be due to the failure to make proper allowance for the time series properties of the data or for the strong simultaneity which exists between import and domestic competing prices. [ABSTRACT FROM AUTHOR]

Strike incidence equations are estimated for manufacturing strikes in Ireland from 1960 to 1989 using both Poisson and negative binomial regression models. A number of alternative business cycle measures are specified. The pro-cyclicity of strikes is confirmed in all cases and is invariant to the measurement of the cyclical component. The numerical size of the cyclical effect on strike activity is, however, quite small. [ABSTRACT FROM AUTHOR]

The article examines the cumulative impact of government support on Northern Ireland manufacturing, using a combination of company accounts and government expenditure data. The starting point is the observation that Northern Ireland manufacturing companies were significantly more profitable than their counterparts in Great Britain. Government assistance can raise company profit rates either by increasing growth or competitiveness. In this respect the scale and duration of government support for manufacturing firms in Northern Ireland make the region an ideal test-bed for assessing the effects of long-term government subsidization of firms. As such the experience of Northern Ireland offers insights into the wider applicability of regional development strategies based on the direct subsidization of companies. Ideally, the analysis would consider the effect of government assistance on individual companies. If all government assistance had acted to encourage extra activity, Northern Ireland manufacturing output would have been expected to grow significantly faster than that in Great Britain as a whole. Similarly, if government assistance (through subsidies) was lowering operating costs, an increase in value added per employee or faster output growth might have been expected.

The relationship between unemployment and health status is examined in a comparative study of five European countries using a time series model. "The hypothesis considered in this paper is that the secular decline in mortality rates can be attributed to the secular rise in real per capita income and that the remaining fluctuations in mortality rates can be explained by cyclical movements in income and variations in unemployment." The data concern the Federal Republic of Germany, France, Italy, Sweden, and Ireland., (excerpt)