New business formation in a rapidly growing economy:the Irish experience


The extraordinary growth of the Irish economy since the mid-1990s—the ‘Celtic Tiger’—has attracted a great deal of interest, commentary and research. Indeed, many countries look to Ireland as an economic development role model, and it has been suggested that Ireland might provide key lessons for other EU members as they seek to achieve the objectives set out in the Lisbon Agenda. Much of the discussion of Ireland’s growth has focused on its possible triggers: the long-term consequences of the late 1980s fiscal stabilisation, EU structural funds, education, wage moderation and devaluation of the Irish punt. The industrial policy perspective has highlighted the importance of inflows of foreign direct investment, but a notable absence from the discourse on the ‘Celtic Tiger’ has been any mention of the role of new business venture creation and entrepreneurship. In this paper we use unpublished Irish VAT data for the years 1988–2004 to provide the first detailed look at national trends in business birth and death rates in Ireland over the ‘take-off’ period. We also use sub-national VAT data to shed light on spatial trends in new venture creation. Our overall conclusions are that new business formation made no detectable contribution to the acceleration of Ireland’s growth in the late 1990s, although we do find evidence of spatial convergence in per capita business stocks.

Publication DOI:
Divisions: College of Business and Social Sciences > Aston Business School > Economics, Finance & Entrepreneurship
College of Business and Social Sciences > Aston Business School
Additional Information: © Springer Science+Business Media, LLC. 2010. The final publication is available at Springer via
Uncontrolled Keywords: new firm formation,employment growth,spatial variation,Ireland,Economics and Econometrics,Business, Management and Accounting(all)
Publication ISSN: 1573-0913
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Related URLs: http://www.scop ... tnerID=8YFLogxK (Scopus URL)
http://link.spr ... 1187-009-9251-1 (Publisher URL)
PURE Output Type: Article
Published Date: 2011-03-24
Authors: Anyadike-Danes, Michael (ORCID Profile 0000-0001-5175-082X)
Hart, Mark (ORCID Profile 0000-0002-0402-4128)
Lenihan, Helena



Version: Accepted Version

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