Impact

Abstract

Economic growth is not an end in itself but, as Stiglitz reminds us in his reference to the ‘post-Washington consensus’,¹ a means to sustainable and equitable development that improves the quality of life for all. In assessing the Celtic Tiger, therefore, the fundamental criterion of evaluation must be its impact on people’s lives. This is the subject of this chapter. It begins by examining more closely the impact on social well-being of the increases in per capita income and in employment detailed in the previous chapter. It then goes on to look at how the benefits of the Celtic Tiger have been distributed, highlighting the growth in social inequality that has resulted. The next section traces this inequality in areas of social provision such as education, health and housing, and also regional and gender dimensions of inequality. Finally, the chapter examines the quality of life under the Celtic Tiger, drawing on evidence relating to areas such as transport and the environment, and also on more subjective assessments.

The Washington consensus advocated use of a small set of instruments (including macroeconomic stability, liberalised trade, and privatisation) to achieve a relatively narrow goal (economic growth). The post-Washington consensus recognises both that a broader set of instruments is necessary and that our goals are also much broader. We seek increases in living standards — including improved health and education — not just increases in measured GDP. We seek sustainable development, which includes preserving natural resources and maintaining a healthy environment. We seek equitable development, which ensures that all groups in society, not just those at the top, enjoy the fruits of development.

Joseph E. Stiglitz, former chief economist at the World Bank, 1998, 31