The importance of counterfactuals

Here is a paper which attempts to assess how Ireland has done since separating from the United Kingdom. It’s title: “The Old Connection Sundered? Ireland and the U.K. since 1916.”

The problem is that the only counterfactuals posed are the expectations of three independence-era economists. Which tells you precisely nothing, save that Ireland became neither a socialist country nor practiced strong import-substitution. There is no attempt to answer the question posed in the title: how would Ireland have performed had it remained part of the United Kingdom?

I am disappointed. 

Comments

[Nich Hills]

Indeed. It doesn't mean that we can't attempt the counterfactual ourselves.

If we take an economic approach we could say the answer depends on the assumptions. Counterfactual 1 might assume that the economy of Ireland, as part of a Continuing United Kingdom of Great Britain and Ireland (CUKGBI) grows at the same rate between 1916 and 2016 as the historical United Kingdom of Great Britain and Northern Ireland (UKGBNI).

Counterfactual 2 might assume that Ireland shares the GDP per capita of CUKGBI. The GDP per capita of CUKGBI can be assumed to be the per capita income of UKGBNI.

Counterfactual 3 might note that there has been a widening gap in incomes between south east UKGBNI and the rest of the country, particularly in the last 40 years and assue Ireland will have the same average income as regional UKGBNI.

Counterfactual 4 might link Irish incomes in CUKGBI to those of Ulster/NI. Counterfactual 5 might note the decline of heavy industry in NI/Ulster in the last four decades and tweak the assumption accoringly.

On the other hand, if we take a historical approach we might first ask what is the point of divergance for an Ireland remanining in a CUKGBI? In particular, what 1916 point of divergence might there be?

As most readers of this blog will know, prior to WWI the Liberal UK government had promised Ireland home rule. This was resisted by the wealthy, protestant Ascendancy and a civil war was threatening to break out when, happily, Archduke Franz Ferdinand was shot.

The circumstances that would result in Ireland being bound to a CUKGBI are hard to see. (Sending the troops that went historically to Archangel in Russia to support instead the Black and Tans doesn't seem enough.) Nevertheless, the consequences of a CUKGBI can still be apprehended. The consequences are unlikely to do the Irish economy much good. Equally, the consequences could do damage to wider economy of CUKGBI.