December 06, 2011
The NYT had a good piece on Ireland’s effort to get back on a solid growth path. At one point it refers to a 5.4 percent rise in exports as an encouraging sign:
“driven by gains from Pfizer, Intel, SAP and other multinational companies that were drawn to Ireland in the 1990s and 2000s by its low taxes, well-educated English-speaking work force and access to the European market.”
Actually, this picture is less clear. Many of the exports associated with these companies are likely to be associated with increased imports as well. For example, if Intel is exporting more microprocessors assembled in Ireland it is also importing more components. The net gain to Ireland’s economy might be very small since most of the value added may take place elsewhere.
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