Trends in the Regional Economic Activity of Ireland: The Role of Productivity

The analysis in this chapter shows that the differential rate of growth in the manufacturing sector was the key driving force behind regional disparities in Ireland, and that this in turn has been driven by differential productivity growth. The degree to which the divergent pattern is due to the underlying industry characteristics was considered in detail. The analysis suggests that there are substantial differences between regions in terms of those characteristics and that these are significantly related to economic performance. These characteristics include the average scale, the degree of foreign ownership and the level of process sophistication, which in turn impact on the level of productivity and profitability.