Thomas Friedman has a very perceptive column about the success of the Irish economy in The New York Times:
Here’s something you probably didn’t know: Ireland today is the richest country in the European Union after Luxembourg.
Yes, the country that for hundreds of years was best known for emigration, tragic poets, famines, civil wars and leprechauns today has a per capita G.D.P. higher than that of Germany, France and Britain. How Ireland went from the sick man of Europe to the rich man in less than a generation is an amazing story. It tells you a lot about Europe today: all the innovation is happening on the periphery by those countries embracing globalization in their own ways – Ireland, Britain, Scandinavia and Eastern Europe – while those following the French-German social model are suffering high unemployment and low growth.
The Irish have done an excellent job of turning their country into a hotbed of economic innovation and strength. Ireland has a rate of unemployment that’s as close to full employment as it’s possible to get. Tax revenues have skyrocketed, and the standard of living in all areas has increased dramatically. And Ireland did it by keeping their corporate taxes low, promoting smart economic growth, and reforming government spending. The Irish had their share of bumps in the road, but the progress they’ve made in the past 15 years is nothing short of astounding. Ireland’s an example of why an open society that embrace globalization, limits the growth of government, and reforms their labor markets can provide a superior quality of life to countries that try to use the power of government to control their economies.