ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Celtic Tiger

The Fall of the Celtic Tiger: Ireland and the Euro Debt Crisis by Donal Donovan and Antoin E Murphy (Oxford: Oxford University Press), 2013; pp 352, £35.

This is the definitive account of the most catastrophic peacetime reversal of economic good fortune experienced by any modern nation state. Ireland’s reversal of apparent economic good fortune is one of the key moments in the global financial crisis of 2007-10. It is a fall from grace rarely, if ever, exceeded in peacetime in recorded world history. At the beginning of 2007, general government debt to gross domestic product (GDP) ratio stood at 25%; 95.5% of the workforce was employed. The budget recorded a surplus. By the end of 2010, unemployment would triple – to almost 14%. The budget deficit would climb to an unheard of 31% of GDP. And the debt/GDP ratio would quadruple, rising to almost 110% by the end of 2011 – it was expected to peak at 150%!

This analytic account of the crisis and its causes is of relevance to the public and policymakers everywhere, including India, for three reasons. First, its methodology is exemplary. Second, its analysis is exhaustive without being boring or difficult to comprehend, even for the layperson. And, third, as a description of yet another instance in which the irresponsible lending policies of banks are at the heart of a boom and bust it is unbeatable.

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