In this NERI Working Paper Series No. 74, Tom McDonnell and Paul Mac Flynn, NERI Co-directors discuss how do we create a model of economic development that is more resilient to the vagaries of a globalised world and fit for the challenges of climate change?
To start we need to be clear that for growth to be resilient, it must be built on foundations of appropriate and intelligent investment in human and physical capital embedded within a supportive innovation system. From early years education to managing skills coordination, reaping the full potential of human capital requires not only funding, but also agility and persistence within our education sector. Infrastructure and innovation need to be nurtured by public capital investment and levels of research and development spending cannot be allowed to deteriorate.
Growth must be inclusive and provide agency and adequacy to its participants. We must broaden labour market opportunities by removing barriers to employment and provide voice and dignity to those in the world of work through access to collective bargaining. Living wages, income floors and universal basic services should underpin and bolster adequate living standards.
Achieving this requires a reappraisal of both fiscal policy and enterprise policies. The state must be properly resourced with revenues levels reflective of our peers and long-term fiscal sustainability, while tax expenditures and subsidies should be continuously reassessed for efficacy. The support we provide to firms must be more strategic and tied to long term goals of innovation and tackling the climate emergency. We also need a proper social safety net to underpin these changes.
The goal of this NERI Working Paper is to generate a discussion around a set of high-level policy reforms for the two economies on the island of Ireland. These policies, while inevitably incomplete, are intended to provide a framework for ongoing sustainable improvements in living standards for all groups within society.