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Ireland in recession

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Comments

  • #102
    eamonnm79
    Closed Accounts Posts: 459 ✭✭eamonnm79


    nesf wrote: »
    Eh, what are you on about? More women working outside the home means more taxable wages being earned which means an increase in GDP and economic growth. There's nothing magical about it, more workers = economic growth for the most part and it's factors like this that explain a lot of where the boom, i.e. the economic growth, came from.

    The words economic growth have very positive conitations. Unjustifiably so in my opinion. Lets look at it in terms of the family unit instead. In the 70's a person on just over the Industrial wage could get a mortgage. House prices were about 5 times annual earnings. At the moment its between 10-12 times. This means that a family has to give about twice as much economic activity just to pay for a similar 3 bed simi-d. In other words both partners have to work!
    Growth = more consumption and more energy requirements but it does not atomaticly mean more prosperity.
    I am not saying that standards of living have not risen in this country but have they enough to justify the quality of life issues that we now have. IMHO for most middle/ lower middle class families the answer would be, Hell NO!
    Without ever being asked families are having to increase their economic output consideribly just to stand still.
    BTW Yes, I Do think this is an economic issue.


  • #103
    asdasd
    Closed Accounts Posts: 3,185 ✭✭✭asdasd


    Lets look at it in terms of the family unit instead. In the 70's a person on just over the Industrial wage could get a mortgage. House prices were about 5 times annual earnings. At the moment its between 10-12 times. This means that a family has to give about twice as much economic activity just to pay for a similar 3 bed simi-d. In other words both partners have to work!

    Blame ( or credit) feminism. There is a cylical logic here: once more women began to work by choice, more women had to work by necessity as otherwise the family was competing for housing as a single earner household against dual earning households, which is a significant disadvantage except for the rich.


  • #104
    leninbenjamin
    Closed Accounts Posts: 8,983 ✭✭✭leninbenjamin


    eamonnm79 wrote: »
    The words economic growth have very positive conitations. Unjustifiably so in my opinion. Lets look at it in terms of the family unit instead. In the 70's a person on just over the Industrial wage could get a mortgage. House prices were about 5 times annual earnings. At the moment its between 10-12 times. This means that a family has to give about twice as much economic activity just to pay for a similar 3 bed simi-d. In other words both partners have to work!
    Growth = more consumption and more energy requirements but it does not atomaticly mean more prosperity.
    I am not saying that standards of living have not risen in this country but have they enough to justify the quality of life issues that we now have. IMHO for most middle/ lower middle class families the answer would be, Hell NO!
    Without ever being asked families are having to increase their economic output consideribly just to stand still.
    BTW Yes, I Do think this is an economic issue.

    that argument does not hold. for one your completely ignoring the ability to repay. the house price is not what determines whether a person can buy a house, it's the interest rates and the repayments. and back in the 70s and 80s you may remember it was very hard to get mortgages; interest rates were massive and created a much heavier burden than today. if you look at the mortgage repayments as a proportion of income you'll find they haven't actually changed much, and in many cases are actually lower as we look to fund a more lavish lifestyle.

    the other factors you're ignoring are a) the decreasing supply of land. b) tighter building regulations adding extra costs to the building process c) increasing costs of materials and inputs (we're having to compete with China and India nowadays) and so on... the list is almost endless.

    oh and as for your final note; that families are having to increase their output, the statistics say other wise. Irish workers in general haven't actually increased productivity since the 60s? I believe. The Celtic Tiger itself was actually based on increases to the work force, not productivity increases.


  • #105
    nesf
    Registered Users, Registered Users 2 Posts: 27,645 ✭✭✭✭nesf


    asdasd wrote: »
    Or: more cheap money = more growth = more workers. the causality is reversed.

    I don't disagree. The causality can run, higher house prices/mortgages = need for more than one income in a household = need for women to work outside of the home = growth increases or more women start working outside of the home = average household income/purchasing power increases = higher house prices on average = more pressure on women not working at home to work outside of the home = increase in women working = increase in growth.

    I'm more pointing out that if women start working outside of the home that we'll tend to see an increase in economic growth simply because more of the population will be generating "value" that will be picked up in measures like GDP rather than claiming any direct causality here. Any increase in the numbers of workers in an economy will tend to increase the base GDP of that country (and GDP per head if these workers were previously in the country but not working).

    eamonnm79 wrote: »
    The words economic growth have very positive conitations.

    I was only pointing out a relationship rather than arguing that growth from an increase of women in the workplace was desirable or positive.


  • #106
    nesf
    Registered Users, Registered Users 2 Posts: 27,645 ✭✭✭✭nesf


    leninbenjamin wrote: »
    oh and as for your final note; that families are having to increase their output, the statistics say other wise. Irish workers in general haven't actually increased productivity since the 60s? I believe. The Celtic Tiger itself was actually based on increases to the work force, not productivity increases.

    Not true I'm afraid. Productivity increases were certainly present in the 70s/80s and 90s. The labour accumulation with no productivity increases that you're speaking of in the Celtic Tiger has only been the case post 2001.


  • #107
    leninbenjamin
    Closed Accounts Posts: 8,983 ✭✭✭leninbenjamin


    nesf wrote: »
    Not true I'm afraid. Productivity increases were certainly present in the 70s/80s and 90s. The labour accumulation with no productivity increases that you're speaking of in the Celtic Tiger has only been the case post 2001.

    hmmm, my memory of this stuff is fading. I think perhaps what i should have said was that the rate of productivity growth hasn't changed significantly since the 60s; i do remember reading quite a few papers that suggested the Celtic Tiger had little to do with productivity growth

    anyway guess it's moot as either undermines my original argument... d'oh. :o


  • #108
    nesf
    Registered Users, Registered Users 2 Posts: 27,645 ✭✭✭✭nesf


    leninbenjamin wrote: »
    hmmm, my memory of this stuff is fading. I think perhaps what i should have said was that the rate of productivity growth hasn't changed significantly since the 60s; i do remember reading quite a few papers that suggested the Celtic Tiger had little to do with productivity growth though

    Growth accounting figures that I've seen (where productivity is GDP/hour worked) have productivity increasing all right. If you think of it in terms of the shift to higher value chain work it's a pretty intuitive result. There were productivity increases both before and during the first half of the Celtic Tiger from these measures. I don't have a link to the papers though off hand.


  • #109
    eamonnm79
    Closed Accounts Posts: 459 ✭✭eamonnm79


    My point was that the Family productivity has grown substantially.
    If two people are working where only one used too, then even without any productivity increse per head, they have doubled their family productivity.


  • #110
    Économiste Monétaire
    Closed Accounts Posts: 2,208 ✭✭✭Économiste Monétaire


    leninbenjamin wrote: »
    hmmm, my memory of this stuff is fading. I think perhaps what i should have said was that the rate of productivity growth hasn't changed significantly since the 60s; i do remember reading quite a few papers that suggested the Celtic Tiger had little to do with productivity growth

    anyway guess it's moot as either undermines my original argument... d'oh. :o
    You sure did read that. It was probably a paper by Prof. Walsh and Prof. Honohan. They argue that the largest factor attributable to the 'Celtic Tiger' was growth in employment. There were productivity increases, but nothing that could be described as amazing.

    Oh, and whomever said that the remarkable growth rate, in real GDP, started in 1998 is wrong.


  • #111
    asdasd
    Closed Accounts Posts: 3,185 ✭✭✭asdasd


    hey argue that the largest factor attributable to the 'Celtic Tiger' was growth in employment.

    Which probably explains why most people think the boom was not all that significant in terms of their personal income.


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  • #112
    leninbenjamin
    Closed Accounts Posts: 8,983 ✭✭✭leninbenjamin


    UCD_Econ wrote: »
    You sure did read that. It was probably a paper by Prof. Walsh and Prof. Honohan. They argue that the largest factor attributable to the 'Celtic Tiger' was growth in employment. There were productivity increases, but nothing that could be described as amazing.

    cheers. they're the guys i was thinking of.


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