Is There a "New Economy" in Ireland?

This paper reviews the sources of economic growth in Ireland between 1962 and 2000. The purpose of this analysis is to assess if there is a “new economy” in Ireland. The “new economy” phenomenon is reflected in higher productivity growth as a result of technical progress in the Information and Communications Technology (ICT) sector. The consequences of a “new economy” include, among other things, a higher potential output growth rate, higher productivity growth, lower unemployment and improved living standards. At the aggregate level, productivity growth increased from 2.5 per cent per annum between 1990 and 1995 to approximately 4.0 per cent per annum between 1996 and 2000. This step-up in productivity growth would suggest a new era in the Irish economy. A sub-sectoral analysis was undertaken to assess which sectors were significant in accounting for this increase in productivity growth. Productivity growth in the industrial sector averaged 2.7 per cent per annum between 1996 and 2000. Within the industrial sector, the manufacturing sector was a significant contributor to productivity growth. Productivity growth in the manufacturing sector averaged 6.3 per cent per annum between 1995 and 1999. The performance of this sector was primarily driven by the high-tech sector, where productivity growth averaged 5.7 per cent per annum between 1995 and 1999. The results suggest that although there has been a significant step-up in the overall productivity growth rate of the economy, this was primarily related to the high-tech sector, particularly the chemicals sector. The large values of net output per worker in this sector may be the result of transfer pricing and/or high returns to research and development. Thus while there has been a structural change of the economy in recent years, this may represent a sectoral shift of resources from more traditional sectors to high-tech sectors rather than a “new economy” effect.

The United States as a growth leader for the Euro Area - A multi-sectoral approach

In this paper we examine the role played by technology spillovers between the United States and the Euro area. We explicitly assume that the United States acts as a growth leader for Europe and that the Euro area is constantly converging to US total factor productivity (TFP) levels. As a result, a growing divergence in the level of US TFP vis-`a-vis that of Europe results in an increase in the growth rate of Euro area TFP. The model is applied to TFP data from 26 subsectors of both economies. The role of greater ICT adoption in increasing Euro area TFP is also explored.

Y a-t-il une nouvelle économie en Irlande?

Dans la présente étude, nous examinons la performance de l’économie irlandaise au moyen d’un cadre comptable de la croissance. Cette analyse vise à déterminer si une « nouvelle économie » s’est implantée en Irlande. Au niveau agrégé, la croissance de la productivité a augmenté considérablement ces dernières années. La productivité impressionnante de l’économie dans son ensemble est attribuable principalement aux secteurs industriels de l’économie. Une analyse désagrégée révèle que la forte croissance de la productivité dans l’ensemble du secteur de la fabrication est attribuable dans une large mesure aux technologies de pointe et plus particulièrement aux produits chimiques. Toutefois, une part importante du succès du secteur des technologies de pointe peut être attribuée à l’investissement des multinationales américaines en Irlande. La production élevée dans ce secteur s’explique par l’établissement de prix de transfert par ces entreprises et du rendement élevé de la recherche et développement. Ainsi, toute conclusion concernant l’implantation d’une « nouvelle économie » en Irlande est assez limitée, puisque les taux de croissance de la productivité dans le secteur des technologies de pointe sont faussés dans les données.This paper examines the performance of the Irish economy using a growth-accounting framework. The aim of this analysis is to determine whether a “new economy” has developed in Ireland. At the aggregate level, productivity growth increased substantially in recent years. The impressive productivity performance of the overall economy was primarily driven by the industrial sectors of the economy. A sub-sectoral analysis revealed that strong productivity growth in the aggregate manufacturing sector was largely accounted for by the high-tech sector, particularly the chemicals sector. However, a large part of the success of the high-tech sector can be attributed to US multinationals investing in Ireland. Transfer pricing by these companies and high returns to research and development results in high net output figures in this sector. This implies that any conclusions regarding a “new economy” in Ireland is rather limited, as productivity growth rates in the high-tech sector are distorted in the data

Potential Output and the Output Gap in Ireland

The performance of the Irish economy in recent years has been outstanding. Between 1994 and 2000, Ireland’s economic growth, as measured by the annual percentage change in real GDP (Gross Domestic Product), has expanded at an annual average rate of approximately 9 per cent. Over the same time period, we have also experienced annual employment growth of approximately 5 per cent and capital growth of around 4 per cent. Recent developments would suggest that such advances cannot continue forever. The capacity of an economy depends on the quantities of labour, capital and technology. Over time that capacity will grow because of the movement of employment from low output industries to high output modern sectors and advances in productivity brought about by improvements in technology. An economy may for brief periods operate above capacity. This is unlikely to persist in the long-run, as there will tend to be a wage and price adjustment process which will restore equilibrium. The capacity of an economy is not measured directly and must be estimated using information from other economic aggregates, which can be measured. Several methods have been proposed but there is no general agreement as to which method is best. This paper applies several of these methods to estimate the capacity of the Irish economy over the period 1960 to 2000. A broad degree of agreement was found between the various methods. Since 1997 the economy has operated above capacity. Forecasts of the capacity growth rate were outlined using estimates from ESRI (1999) and internal Central Bank estimates. This suggests that economy will be operating below capacity by 2004, when a more sustainable level of output is achieved. The output gap is defined as the difference between actual and capacity output. A positive gap (output greater than capacity) is associated with excess demand in the economy, which is a likely cause of inflation. In an open economy, such as Ireland, it is often argued that the main determinants of inflation are foreign prices and the exchange rate. The measures of the output gap derived in this paper indicate that they have some influence on overall inflation in Ireland, but the results were relatively weak. The relationship between “domestically generated” inflation and the output gap measures indicated a much stronger correlation.

Investigating the role of early low-dose aspirin in diabetes: A phase III multicentre double-blinded placebo-controlled randomised trial of aspirin therapy initiated in the first trimester of diabetes pregnancy

Background: Preeclampsia, preterm birth and low birth weight represent key contributing factors to perinatal morbidity and mortality. Pregnancies complicated by type 1 and type 2 diabetes are at increased risk of these complications, which are purported to be largely attributed to placental dysfunction. Studies investigating a potential role for aspirin therapy in optimizing perinatal outcome have consistently failed to demonstrate a benefit among women with pre-existing diabetes, and yet widespread aspirin administration has become common practice in many centres. This study seeks to examine the effect of aspirin therapy, administered from the first trimester until 36 weeks gestation, on perinatal outcome in women with established pre-pregnancy diabetes. Our hypothesis is that aspirin therapy will reduce complications mediated by placental dysfunction, and improve perinatal outcomes. Methods: This phase III double-blinded, placebo-controlled randomized clinical trial will be conducted in seven tertiary-level perinatology centres in Ireland. Consenting participants who meet all eligibility criteria will be allocated randomly to either aspirin 150 mg once daily or matching placebo, commenced between 11 + 0 and 13 + 6 weeks. Allocation will take place electronically using software by Clininfo with randomization tables provided by the trial biostatistician. The primary outcome will be a composite clinical measure of placental dysfunction (preeclampsia, preterm birth before 34 weeks, birthweight below the 10th centile or perinatal mortality). This trial has been set up such that it is parallel in design and is a superiority study. No participants have been recruited yet. The trial has been registered with Eudra Clinical Trials - EudraCT Number 2018-000770-29. Funding for this trial was granted by the Health research Board (HRB) 1/9/2017(DIFA-2017-026). Discussion: Aspirin therapy has been investigated for the prevention of preeclampsia owing to its reduction on thromboxane production. Previous studies have failed to demonstrate a beneficial effect of aspirin on perinatal outcome amongst women with type I or type II diabetes. It is plausible that the failure to observe benefit to date, among the limited aspirin studies that have included participants with diabetes, may be a consequence of aspirin initiation too late in pregnancy to exert any effect on placentation. We believe that if aspirin is to be used for the prevention of placental dysfunction, it must be initiated before the second active phase of trophoblast invasion, which takes place from 14 weeks’ gestation onwards. No randomized trials investigating the role of aspirin in prevention of preeclampsia in pregnancies complicated by diabetes have previously initiated treatment in the first trimester, the gestational period at which it is most likely to exert an effect on placentation

Investigating the role of early low-dose aspirin in diabetes: a phase III multicentre double-blinded placebo-controlled randomised trial of aspirin therapy initiated in the first trimester of diabetes pregnancy

Background: Preeclampsia, preterm birth and low birth weight represent key contributing factors to perinatal morbidity and mortality. Pregnancies complicated by type 1 and type 2 diabetes are at increased risk of these complications, which are purported to be largely attributed to placental dysfunction. Studies investigating a potential role for aspirin therapy in optimizing perinatal outcome have consistently failed to demonstrate a benefit among women with pre-existing diabetes, and yet widespread aspirin administration has become common practice in many centres. This study seeks to examine the effect of aspirin therapy, administered from the first trimester until 36 weeks gestation, on perinatal outcome in women with established pre-pregnancy diabetes. Our hypothesis is that aspirin therapy will reduce complications mediated by placental dysfunction, and improve perinatal outcomes. Methods: This phase III double-blinded, placebo-controlled randomized clinical trial will be conducted in seven tertiary-level perinatology centres in Ireland. Consenting participants who meet all eligibility criteria will be allocated randomly to either aspirin 150 mg once daily or matching placebo, commenced between 11 + 0 and 13 + 6 weeks. Allocation will take place electronically using software by Clininfo with randomization tables provided by the trial biostatistician. The primary outcome will be a composite clinical measure of placental dysfunction (preeclampsia, preterm birth before 34 weeks, birthweight below the 10th centile or perinatal mortality). This trial has been set up such that it is parallel in design and is a superiority study. No participants have been recruited yet. The trial has been registered with Eudra Clinical Trials - EudraCT Number 2018-000770-29. Funding for this trial was granted by the Health research Board (HRB) 1/9/2017(DIFA-2017-026). Discussion: Aspirin therapy has been investigated for the prevention of preeclampsia owing to its reduction on thromboxane production. Previous studies have failed to demonstrate a beneficial effect of aspirin on perinatal outcome amongst women with type I or type II diabetes. It is plausible that the failure to observe benefit to date, among the limited aspirin studies that have included participants with diabetes, may be a consequence of aspirin initiation too late in pregnancy to exert any effect on placentation. We believe that if aspirin is to be used for the prevention of placental dysfunction, it must be initiated before the second active phase of trophoblast invasion, which takes place from 14 weeks' gestation onwards. No randomized trials investigating the role of aspirin in prevention of preeclampsia in pregnancies complicated by diabetes have previously initiated treatment in the first trimester, the gestational period at which it is most likely to exert an effect on placentation.</p

Investigating the role of early low-dose aspirin in diabetes: a phase III multicentre double-blinded placebo-controlled randomised trial of aspirin therapy initiated in the first trimester of diabetes pregnancy

Background: Preeclampsia, preterm birth and low birth weight represent key contributing factors to perinatal morbidity and mortality. Pregnancies complicated by type 1 and type 2 diabetes are at increased risk of these complications, which are purported to be largely attributed to placental dysfunction. Studies investigating a potential role for aspirin therapy in optimizing perinatal outcome have consistently failed to demonstrate a benefit among women with pre-existing diabetes, and yet widespread aspirin administration has become common practice in many centres. This study seeks to examine the effect of aspirin therapy, administered from the first trimester until 36 weeks gestation, on perinatal outcome in women with established pre-pregnancy diabetes. Our hypothesis is that aspirin therapy will reduce complications mediated by placental dysfunction, and improve perinatal outcomes. Methods: This phase III double-blinded, placebo-controlled randomized clinical trial will be conducted in seven tertiary-level perinatology centres in Ireland. Consenting participants who meet all eligibility criteria will be allocated randomly to either aspirin 150 mg once daily or matching placebo, commenced between 11 + 0 and 13 + 6 weeks. Allocation will take place electronically using software by Clininfo with randomization tables provided by the trial biostatistician. The primary outcome will be a composite clinical measure of placental dysfunction (preeclampsia, preterm birth before 34 weeks, birthweight below the 10th centile or perinatal mortality). This trial has been set up such that it is parallel in design and is a superiority study. No participants have been recruited yet. The trial has been registered with Eudra Clinical Trials - EudraCT Number 2018-000770-29. Funding for this trial was granted by the Health research Board (HRB) 1/9/2017(DIFA-2017-026). Discussion: Aspirin therapy has been investigated for the prevention of preeclampsia owing to its reduction on thromboxane production. Previous studies have failed to demonstrate a beneficial effect of aspirin on perinatal outcome amongst women with type I or type II diabetes. It is plausible that the failure to observe benefit to date, among the limited aspirin studies that have included participants with diabetes, may be a consequence of aspirin initiation too late in pregnancy to exert any effect on placentation. We believe that if aspirin is to be used for the prevention of placental dysfunction, it must be initiated before the second active phase of trophoblast invasion, which takes place from 14 weeks' gestation onwards. No randomized trials investigating the role of aspirin in prevention of preeclampsia in pregnancies complicated by diabetes have previously initiated treatment in the first trimester, the gestational period at which it is most likely to exert an effect on placentation.</p