A year ago, when the full impact of the financial crisis hit Ireland, it took some time for economists to assess what was happening and what were the full implications of the disaster. Economic forecasts were changing daily and the huge uncertainty about what was actually developing made policy-making exceptionally difficult. However, over the course of the winter and early spring economists came to understand what was happening in Ireland and the outside world somewhat better. In May, with colleagues in the ESRI, we published a paper (Bergin et al., 2009) which considered the possible paths to recovery for the Irish economy. This analysis suggested that the Irish economy, while suffering major permanent damage as a consequence of the recession, would return to a period of quite rapid growth once the world economy itself entered the recovery phase. At the time of publishing the recovery in the world economy was only a gleam in the economists’ eye. However, over the last six months there have been increasing signs of a return, if not to business as usual in the world economy, at least to limited growth
