Sunday, January 22, 2017

Irish Unity Makes Economic Sense

Study by researchers who have examined German and Korean unification models shows long-term improvement of GDP per capita in the North of 4 to 7.5 percent, while the Republic would see a boost of 0.7 to 1.2 percent.
At an evening presentation at the Harvard Club in Midtown Manhattan, two prominent scholars in the field of political science and economics released the findings of a landmark, first-ever economic study entitled Modeling Irish Unification, which showed significant long-term improvement in the stagnant Northern Irish economy would result from removing currency, trade and tax barriers that currently impede economic growth.
The report also showed improvements for theRepublic of Ireland, which would benefit from barrier-free access to the Northern Irish market. By modeling three separate unification scenarios, the researchers showed a long-term improvement of GDP per capita in the North of 4 to 7.5 percent, while the Republic of Irelandwould see a boost of 0.7 to 1.2 percent.
The report presents the first comprehensive economic models simulating the political and economic integration of Northern Ireland and the Republic of Ireland. The study is particularly timely given current debates over Irish economic growth and the U.K.'s continued participation in the European Union. Three unification scenarios were presented, with the most aggressive estimating a 35.6 billion Euroboost in an all-island GDP in the first eight years of unification.
Representatives of government, the financial sector and international relations communities attended the event.
The research was led by Dr. Kurt Hubner, professor of political science, Jean Monnet Chair for European Integration and Global Political Economy and Director of the Institute for European Studies at the University of British Columbia. Dr. Hubner directed the research through his firm KLC – Consulting for Tomorrow, an economic and political relations consulting firm based in Vancouver. The economic model was developed by Dr. Renger Herman van Nieuwkoop, Director and Founder of ModelWorks and professor of economics at ETH Zurich.
"Our modeling exercise points to strong positive unification effects driven by successful currency devaluation and a policy dependent industrial turn-around," said Dr. Hubner. "While these effects occur in a static global economic environment, under ideal political conditions, they underline the potential of political and economic unification when it is supported by smart economic policy."
In the executive summary, Professor Steven Raphael, UC Berkeley, wrote: "Political and economic unification of the North and South would likely result in a sizable boost in economic output and incomes in the North and a smaller boost in the [Republic of Ireland]."
Marcus Noland, Executive Vice President and Director of Studies at the Peterson Institute for International Economics, provided comment on the study, writing: "Modeling Irish Unification is an important, timely examination of the economics of Irish unification, applying state-of-the-art modeling techniques to the issue at hand. The modeling work illustrates a variety of channels which are likely to be at play in the Irish case, and concludes that Irish unification would be economically beneficial to both parts of the island, especially for smaller, poorer,Northern Ireland."
After Dr. Hubner and Dr. van Nieuwkoop'sconcluded their remarks, Michael Burke, economic consultant and former Senior International Economist at Citibank in London, discussed the global impact of a unifiedIreland.
"The issue of the benefits of a unified Irish economy are unfortunately largely overlooked," said Burke. "This paper goes some way to correcting that and will help develop discussion in this neglected area."
The study was commissioned by K.R.B., a San Francisco Bay area–based nonprofit social welfare organization that promotes social welfare and conflict resolution through education.

No comments:

Post a Comment