What are the hidden truths of society

 

Ireland is the spectacular economic wonderland of Europe, the "Celtic Tiger". For about 15 years it has worked its way up from the poor house in Europe to second place in the income league of the European Union with high growth rates. Only Luxembourg has a higher gross domestic product per capita in the eu than Ireland. In doing so, Ireland has not least overtaken its old arch-rival England. In view of the fact that many new poor countries have joined the eu, the case of Ireland is gaining additional importance. Can Ireland be a model for the new Member States?

One can expect an answer to this from the present book by the Leipzig political scientist Philipp Fink, as it ends with a final chapter "Emulation Desirable?"
which starts with the economic determinants, then turns to the history of the Irish state and its development strategy, and finally looks at the effects of the specific Irish path with its heavy use of foreign investment. The result can be summarized as follows:
Ireland owes its success to an extremely investment-friendly government development strategy, which, thanks to further fortunate circumstances, succeeded in attracting an enormous influx of foreign investment into the country, which led to growth and almost full employment, but at the same time increased inequality and dualization in the economy and society. The author is therefore unable to make a right recommendation for imitation. However, the final chapter devoted to this question only summarizes the problems of the Irish way without drawing any political conclusions. The question of the possibility of imitation by other countries also remains open. The reader must make such considerations on the basis of the insights Fink gives him of the causes and effects of the Irish Way.

As far as the causes of the Irish "miracle" are concerned, Fink initially provides few new aspects: EU membership, demographics, macroeconomic stabilization and foreign investments were important. Those who already knew the basic facts learn new things, especially in the chapter on the Irish developing state, which examines important economic trends, conflicts of interest and room for maneuver. Regarding the effects, the unequal distribution of income (especially between domestic wages and foreign profits, which has led to an enormous gap between Irish domestic and national product) is already well known. But Fink goes deeper and highlights the structural dualization of the Irish economy, whose domestic sector is hardly intertwined with the international one.

So if you are looking for an insight into the memorable case of Ireland that is not too extensive, but which goes beyond an article, this little book will serve you well. The somewhat more knowledgeable or theoretically interested reader will not be spared some frustrations. That starts with that
Foreword by Elsenhans, probably the most in-depth development theorist in Germany, who is unfortunately primarily characterized by hidden truths that - if at all - only reveal themselves after a third reading and after a long period of reflection. But there are also inconsistencies in Fink's own theoretical model. On the one hand, he tends towards a Keynesian growth model that relies on demand (e.g. on page 116, where he quotes Elsenhans, or his frequent critical swipes at the "deflationists" in Irish economic policy, pp. 74-76). On the other hand, he considers a low-wage strategy to be promising,
which in Ireland also fails because of the high level of emigration, which is reducing the supply of labor and thus driving up wages (p. 60). Similarly, the role of the state remains ambivalent, which on the one hand is seen as too weak because of its liberal philosophy (p. 143), although on the other hand it also becomes clear that
Protectionist interventions also only brought about inefficiency and no competitive development (pp. 73–74). Fink's ideal is obviously the Asian developing state (at least in terms of its technocratic economic policy competence, less in terms of its democratic legitimacy). Ireland is against it
the example of a growth strategy that is not based on state-induced learning and innovation processes that promote exports and substitute imports, and on domestic markets that expand through mass purchasing power. Fink makes it clear that the downside of the Irish example cannot be overlooked, his
He makes boundaries less clear.

Michael Dauderstädt
Friedrich Ebert Foundation, Bonn