The HERMES macroeconomic model has been used extensively for over 25 years to carry out medium-term forecasting and scenario analysis of the Irish economy. Most recently the model has been used to generate the scenarios underpinning the 2013 edition of the ESRI's Medium-Term Review. In the long...

This paper considers the impact of changes in the rate of corporation tax in Ireland affecting the services sector. A model is estimated that relates services exports and output to world activity, competitiveness and the rate of corporation tax. This model indicates that a reduction in the rate...

This paper examines recovery scenarios for the Irish economy. It estimates that the growth rate in potential output is 3% a year. This takes account of a permanent loss of output of 10% of GDP as a result of the recession. On this basis, and taking account of government fiscal action this year...

This paper analyses the medium-term effects of a carbon tax on growth and CO2 emissions in Ireland, a small open economy. We find that a double dividend exists if the carbon tax revenue is recycled through reduced income taxes. If the revenue is recycled by giving a lump-sum transfer to...

The experience of the last five years has been truly exceptional, involving the worst economic crisis in Ireland since the Second World War. The legacy effects of this crisis include a dramatic increase in the indebtedness of the state as well as an exceptionally high level of unemployment. The...