The Letter explains that ranking Ireland’s economic prosperity based on Gross Domestic Product (GDP) or Gross National Income (GNI) tend to be misleading. This is because of the statistical distortions created by the activities of multinational corporations (MNCs) (particularly depreciation of intellectual property assets and the large aircraft fleets of resident leasing companies). Nevertheless GDP and GNI are the single indicators most commonly used in international league tables despite their known deficiencies.
Like all fiscal paradise all the money are in a very few hands who wish nothing but to spend it somewhere else
So they can afford to dial down their tax evasion Business? Great news
If they are so Rich…. Why people are suffering beeing poor?
For quality of life purposes GDP says usually nothing without being paired with median (not average!) income
Yet median wealth is low and inequality very high.
Ireland is a bubble ready to explode. The celtic Tiger was long time ago and they had a though recession years ago. They have a fragile economy, based only on tertiary sector, a lot of inequalities, a house market ready to crash and poor public services.
direct result of clever tax incentive policy irish government implemented to attract corporations there. now EU wants to revers that trend which will cause those companies to leave.
Strongest case for Irexit is being slowly made in my country. It would be handled differently than Brexit though, maybe a Customs Union. You have an increasing wealth gap and accommodation crisis. You have a resurgent right wing blaming immigrants. You have ruling parties historically beholden to the principles of a corporatocracy. You have the biggest polling party currently who have a history of EU skepticism. You have a majority of the population reluctant to get drawn in to a European army and reluctant to change the neutrality status. And most importantly of all, you have a net contributor status. Give it ten years.
Edit – for people downvoting, try to understand this is not my personal desire. It is what I believe will unfortunately happen. You might downvote because it makes you uncomfortable if you are Irish or if you are a fervent supporter of the EU project. But the social, economic and domestic political circumstances of Ireland as well as external forces will make a Customs Union much easier to argue for in the next decade.
Thank you, Brexit!
The most misleading data in the world
GDP / capita must be one of the most misleading statistics ever
Any European jealous of this seemingly incredible data should hire a car and drive around the Republic. It’s very picturesque, and there’s clear wealth, but the overwhelming impression will be of the terrible housing and crushing poverty you’ll see just about anywhere. No need even to go outside Dublin for this exercise. You’ll notice the huge difference between RoI and NL, DK, S, D. You’ll need to go south to find anything comparable.
Why the EU allows this outrageous under-cutting of every other member I do not understand.
BTW: Showcase for a global minimum corporate tax. 15% it is!
Everybody is saying this is lies and misleading, but as someone who moved into Ireland without university degree, I live better than I would live than in any other country, and same with my peers. I also have more free time for my hobbies, and I’m genuenly happier. I will probably never own a house tho.
I’m grateful to Ireland for accepting me, and happy that I basically have nonexistent problems in my life now.
Don’t hate it if it works, maybe other countries should follow suit.
Distorted figures, doesn’t translate to wealth across the country. I saw dozens of homeless people lining the streets of Dublin when visiting for a weekend. I’d only seen things like that in the States.
So what happened in 2014-15?
It seems important because it’s been steadily increasing since then.
Any ideas/info?
Propably because its a great place for businesses…alog of shady shit happens there because of companyfriendly taxes
Meanwhile I have a relative in Ireland, collapsed lung, 1 week to have it diagnosed, has been on a trolley bed because not enough beds available in the hospital….
GDP in Ireland is notoriously biased by an accounting trick : the intangible assets,( that is intellectuel propertiy goods, patents etc) that are transferred from global Headquarters to EU subsidiaires located in Ireland are counted as “Investment”, and thus pump up GDP (as GDP is the algebraic sum of Consumption + Investment + Gov Cons. + Net trade).
It is not faulty, nor manipulative, it is just that the National Account rules, when applied to the complexity of corporate operations in Ireland result in a GDP that has brutal hikes, and that is more and more decorrelated with living standards (household income, conjunctural slack, etc.).
Don’t get me wrong : the living conditions ARE good in Ireland and the country IS developping fast, Indeed.
It is just that the +10% GDP hikes over a couple of quarters that have been going on since 2015 don’t make sense, and are merely the reflection of operations in trans-national firms.
Irish authorities have developped alternate measurements to correct for this bias
Numbers on a bit of paper don’t really give a living picture of life for people though.
This is wildly distorted by multinational income reporting and Irelands beggar thy neighbour tax policies. In fact the distortion is so large that it effects EU wide measurement of GDP.
Believe it until you live there 🙂 Otherwise, it’s a lovely country – yes, also to live in.
GDP (even per capita) is a horrendous meassurement of living standards.
The average is known to be skewed by extreme values. Why don’t they use the median value and median income? This is a misleading stat.
Ireland is one of those few countries where there are so much money coming in with no labor done that they could give an universal wage to all the inhabitants to do nothing more.
Like Switzerland, but i must admit that i’m stunted by Irland’s economical doctrines, making them a real economic power in Europe alongside its european allies.
GDP per capita is a completely useless metric because Ireland is a tax haven which massively skews it.
According to this report published by our own central bank {[https://www.bing.com/ck/a?!&&p=b3253f16f13dc941JmltdHM9MTY3MzgyNzIwMCZpZ3VpZD0zNDQyYjAyNC04ZjM3LTY5ZTUtMmRjNy1hMjFjOGIzNzZiYTkmaW5zaWQ9NTE2NA&ptn=3&hsh=3&fclid=3442b024-8f37-69e5-2dc7-a21c8b376ba9&psq=central+bank+is+ireland+really+prosperous&u=a1aHR0cHM6Ly93d3cuY2VudHJhbGJhbmsuaWUvZG9jcy9kZWZhdWx0LXNvdXJjZS9wdWJsaWNhdGlvbnMvZWNvbm9taWMtbGV0dGVycy92b2wtMjAyMS1uby0xLWlzLWlyZWxhbmQtcmVhbGx5LXRoZS1tb3N0LXByb3NwZXJvdXMtY291bnRyeS1pbi1ldXJvcGUucGRmP3NmdnJzbj0yNQ&ntb=1](https://www.bing.com/ck/a?!&&p=b3253f16f13dc941JmltdHM9MTY3MzgyNzIwMCZpZ3VpZD0zNDQyYjAyNC04ZjM3LTY5ZTUtMmRjNy1hMjFjOGIzNzZiYTkmaW5zaWQ9NTE2NA&ptn=3&hsh=3&fclid=3442b024-8f37-69e5-2dc7-a21c8b376ba9&psq=central+bank+is+ireland+really+prosperous&u=a1aHR0cHM6Ly93d3cuY2VudHJhbGJhbmsuaWUvZG9jcy9kZWZhdWx0LXNvdXJjZS9wdWJsaWNhdGlvbnMvZWNvbm9taWMtbGV0dGVycy92b2wtMjAyMS1uby0xLWlzLWlyZWxhbmQtcmVhbGx5LXRoZS1tb3N0LXByb3NwZXJvdXMtY291bnRyeS1pbi1ldXJvcGUucGRmP3NmdnJzbj0yNQ&ntb=1)} actual living standards in Ireland are more similar to Spain and Italy then they are even to the UK and US, never mind top of the world. And I honestly believe that is a much more accurate representation of how we really are in terms of wealth and quality of life.
The reason is profit shifting. Ireland’s GDP per capital figures should always be treated with a grain of salt.
yes, only Luxembourg and Singapore overtook her – this is amazing
38 comments
source: https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD?locations=DE-IE-US
Not surprising considering its near-tax-haven status.
Explanation: [https://www.centralbank.ie/news-media/press-releases/press-release-economic-letter-is-ireland-really-the-most-prosperous-country-in-europe-04-january-2021](https://www.centralbank.ie/news-media/press-releases/press-release-economic-letter-is-ireland-really-the-most-prosperous-country-in-europe-04-january-2021)
The Letter explains that ranking Ireland’s economic prosperity based on Gross Domestic Product (GDP) or Gross National Income (GNI) tend to be misleading. This is because of the statistical distortions created by the activities of multinational corporations (MNCs) (particularly depreciation of intellectual property assets and the large aircraft fleets of resident leasing companies). Nevertheless GDP and GNI are the single indicators most commonly used in international league tables despite their known deficiencies.
Like all fiscal paradise all the money are in a very few hands who wish nothing but to spend it somewhere else
So they can afford to dial down their tax evasion Business? Great news
If they are so Rich…. Why people are suffering beeing poor?
For quality of life purposes GDP says usually nothing without being paired with median (not average!) income
Yet median wealth is low and inequality very high.
Ireland is a bubble ready to explode. The celtic Tiger was long time ago and they had a though recession years ago. They have a fragile economy, based only on tertiary sector, a lot of inequalities, a house market ready to crash and poor public services.
direct result of clever tax incentive policy irish government implemented to attract corporations there. now EU wants to revers that trend which will cause those companies to leave.
Strongest case for Irexit is being slowly made in my country. It would be handled differently than Brexit though, maybe a Customs Union. You have an increasing wealth gap and accommodation crisis. You have a resurgent right wing blaming immigrants. You have ruling parties historically beholden to the principles of a corporatocracy. You have the biggest polling party currently who have a history of EU skepticism. You have a majority of the population reluctant to get drawn in to a European army and reluctant to change the neutrality status. And most importantly of all, you have a net contributor status. Give it ten years.
Edit – for people downvoting, try to understand this is not my personal desire. It is what I believe will unfortunately happen. You might downvote because it makes you uncomfortable if you are Irish or if you are a fervent supporter of the EU project. But the social, economic and domestic political circumstances of Ireland as well as external forces will make a Customs Union much easier to argue for in the next decade.
Thank you, Brexit!
The most misleading data in the world
GDP / capita must be one of the most misleading statistics ever
Any European jealous of this seemingly incredible data should hire a car and drive around the Republic. It’s very picturesque, and there’s clear wealth, but the overwhelming impression will be of the terrible housing and crushing poverty you’ll see just about anywhere. No need even to go outside Dublin for this exercise. You’ll notice the huge difference between RoI and NL, DK, S, D. You’ll need to go south to find anything comparable.
Why the EU allows this outrageous under-cutting of every other member I do not understand.
BTW: Showcase for a global minimum corporate tax. 15% it is!
That looks like suck a bomb and bust cycle
We are a corporate piggy bank nothing more
It might be more useful to take a look at [the median income](https://worldpopulationreview.com/country-rankings/median-income-by-country) by country:
USA: $19,306
Germany: $16,845
Ireland: $14,520
I wish
Everybody is saying this is lies and misleading, but as someone who moved into Ireland without university degree, I live better than I would live than in any other country, and same with my peers. I also have more free time for my hobbies, and I’m genuenly happier. I will probably never own a house tho.
I’m grateful to Ireland for accepting me, and happy that I basically have nonexistent problems in my life now.
Don’t hate it if it works, maybe other countries should follow suit.
Distorted figures, doesn’t translate to wealth across the country. I saw dozens of homeless people lining the streets of Dublin when visiting for a weekend. I’d only seen things like that in the States.
So what happened in 2014-15?
It seems important because it’s been steadily increasing since then.
Any ideas/info?
Propably because its a great place for businesses…alog of shady shit happens there because of companyfriendly taxes
Meanwhile I have a relative in Ireland, collapsed lung, 1 week to have it diagnosed, has been on a trolley bed because not enough beds available in the hospital….
GDP in Ireland is notoriously biased by an accounting trick : the intangible assets,( that is intellectuel propertiy goods, patents etc) that are transferred from global Headquarters to EU subsidiaires located in Ireland are counted as “Investment”, and thus pump up GDP (as GDP is the algebraic sum of Consumption + Investment + Gov Cons. + Net trade).
It is not faulty, nor manipulative, it is just that the National Account rules, when applied to the complexity of corporate operations in Ireland result in a GDP that has brutal hikes, and that is more and more decorrelated with living standards (household income, conjunctural slack, etc.).
Don’t get me wrong : the living conditions ARE good in Ireland and the country IS developping fast, Indeed.
It is just that the +10% GDP hikes over a couple of quarters that have been going on since 2015 don’t make sense, and are merely the reflection of operations in trans-national firms.
Irish authorities have developped alternate measurements to correct for this bias
Ex : this document from the Central Bank of Ireland
https://www.centralbank.ie/docs/default-source/publications/quarterly-bulletins/qb4-2021/box-c-the-disconnection-of-gdp-from-economic-activity-carried-out-in-ireland.pdf?sfvrsn=87f98d1d_2
Numbers on a bit of paper don’t really give a living picture of life for people though.
This is wildly distorted by multinational income reporting and Irelands beggar thy neighbour tax policies. In fact the distortion is so large that it effects EU wide measurement of GDP.
https://www.politico.eu/article/ireland-gdp-growth-multinationals-misleading/amp/
On an actual consumption basis Ireland is very different than a GDP/capita measure.
https://www.centralbank.ie/docs/default-source/publications/economic-letters/vol-2021-no-1-is-ireland-really-the-most-prosperous-country-in-europe.pdf
The Central Statistics Office published a modified GNI* which accounts for the distortions which placed national income considerably lower in 2019.
https://www.cso.ie/en/releasesandpublications/in/nie/in-mgnicp/
Looks like the OP didn’t hear about Leprechaun Economics.
https://en.m.wikipedia.org/wiki/Leprechaun_economics
Believe it until you live there 🙂 Otherwise, it’s a lovely country – yes, also to live in.
GDP (even per capita) is a horrendous meassurement of living standards.
The average is known to be skewed by extreme values. Why don’t they use the median value and median income? This is a misleading stat.
Ireland is one of those few countries where there are so much money coming in with no labor done that they could give an universal wage to all the inhabitants to do nothing more.
Like Switzerland, but i must admit that i’m stunted by Irland’s economical doctrines, making them a real economic power in Europe alongside its european allies.
GDP per capita is a completely useless metric because Ireland is a tax haven which massively skews it.
According to this report published by our own central bank {[https://www.bing.com/ck/a?!&&p=b3253f16f13dc941JmltdHM9MTY3MzgyNzIwMCZpZ3VpZD0zNDQyYjAyNC04ZjM3LTY5ZTUtMmRjNy1hMjFjOGIzNzZiYTkmaW5zaWQ9NTE2NA&ptn=3&hsh=3&fclid=3442b024-8f37-69e5-2dc7-a21c8b376ba9&psq=central+bank+is+ireland+really+prosperous&u=a1aHR0cHM6Ly93d3cuY2VudHJhbGJhbmsuaWUvZG9jcy9kZWZhdWx0LXNvdXJjZS9wdWJsaWNhdGlvbnMvZWNvbm9taWMtbGV0dGVycy92b2wtMjAyMS1uby0xLWlzLWlyZWxhbmQtcmVhbGx5LXRoZS1tb3N0LXByb3NwZXJvdXMtY291bnRyeS1pbi1ldXJvcGUucGRmP3NmdnJzbj0yNQ&ntb=1](https://www.bing.com/ck/a?!&&p=b3253f16f13dc941JmltdHM9MTY3MzgyNzIwMCZpZ3VpZD0zNDQyYjAyNC04ZjM3LTY5ZTUtMmRjNy1hMjFjOGIzNzZiYTkmaW5zaWQ9NTE2NA&ptn=3&hsh=3&fclid=3442b024-8f37-69e5-2dc7-a21c8b376ba9&psq=central+bank+is+ireland+really+prosperous&u=a1aHR0cHM6Ly93d3cuY2VudHJhbGJhbmsuaWUvZG9jcy9kZWZhdWx0LXNvdXJjZS9wdWJsaWNhdGlvbnMvZWNvbm9taWMtbGV0dGVycy92b2wtMjAyMS1uby0xLWlzLWlyZWxhbmQtcmVhbGx5LXRoZS1tb3N0LXByb3NwZXJvdXMtY291bnRyeS1pbi1ldXJvcGUucGRmP3NmdnJzbj0yNQ&ntb=1)} actual living standards in Ireland are more similar to Spain and Italy then they are even to the UK and US, never mind top of the world. And I honestly believe that is a much more accurate representation of how we really are in terms of wealth and quality of life.
The reason is profit shifting. Ireland’s GDP per capital figures should always be treated with a grain of salt.
yes, only Luxembourg and Singapore overtook her – this is amazing
Yeah and this will tell you who has all the money: https://www.rte.ie/news/business/2023/0116/1346849-1-of-irish-population-owns-27-of-the-wealth-oxfam/