1. “Shall I compare you to a…” Dr Esmond Birnie, Senior Economist at Ulster University Business School NERI 15 November 2018

2. A brief history of comparing NI…
Isles and Cuthbert (1957), almost entirely to GB.
Hitchens, Wagner and Birnie (1990), initially to West Germany and GB (later to East Germany, Czechoslovakia, Hungary, Italy and RoI).
Various studies for DETI (c. 2009), back-up to the IREP, mainly to RoI, Finland, Estonia. Some to Sweden, Singapore, Costa Rica, Portland OR.
SQW/Cambridge Econometrics (2013) for EAG to the WEF comparators, i.e. 144 countries.
UUEPC (2016) for the EAG, the Competitiveness Scorecard with about 30 (mainly OECD/Eurostat) countries.
DfE (2017) in tandem with the draft Industrial Strategy, comparisons to eight “small advanced economies”. I will focus on this.

3. DfE May 2017 paper “Benchmarking Northern Ireland’s competitiveness”
Four main parts to their paper which we will assess in turn:
Selection process re. the comparators.
Framework for making comparisons.
Measurement of performance.
Agenda for policy/research.

4. (1.) Selection of the comparators
The development of the DfE’s logic seems impressive:
Exclude any country outside of the top 40 in either the WEF or IMD rankings.
(Latvia, Slovenia and Slovak Republic removed.)
Exclude any country with a population greater than 10m or GDP greater than $500bn. (Czech Republic and Sweden removed.)
Exclude any country with a “central” (non-peripheral) European location. (Switzerland and Austria removed.)
Exclude any country with “irrelevant” reasons for its economic success or very unique features. (Norway (oil), Iceland (very small, the role of its banking sector), Lithuania (GDP per capita still much lower than NI) removed.)

5. Leaving… Eight comparators Denmark. Estonia. Finland. Israel.
New Zealand.
RoI.
Scotland.
Singapore.

6. Assessment of this selection
DfE admit there is no single definitive list (and the appropriate comparators could change over time). Questions:
Are Switzerland and Austria really that “central”? (Politically interesting given post-Second World War records of unusual coalition governments.)
Iceland, the size of Belfast but interesting lessons?
More of the former E. bloc given they have been converging?
Why Scotland?
Note, the Scottish Government adds Austria, Belgium, Hong Kong, Netherlands, Norway but excludes Estonia and Israel i.e. 12 countries in the peer group.

7. (2.) DfE’s measurement framework
Pillars of competitiveness given weights:
Pillar
Weighting (%)
Economic output 20
International engagement
Innovation and human capital 40
Labour supply 10
Business environment

8. Assessment of the framework
Weights- inevitably subjective. But, why is Corporation Tax “only” 5%.
Indicators- why are external sales used for NI and Scotland but exports for the other seven (a bias)?
No indicator re. (lack of) governance (!)

9. (3.) Measurement results
Average competitiveness score
Weighted score (out of 5)
Singapore
4.02
RoI
3.31
Denmark
3.3
Finland
3.14
Scotland
2.91 NI
2.74
Israel
2.73
New Zealand
2.62
Estonia
2.58

10. Some assessment of these measurement results
Singapore is top, is that surprising (WEF similarly).
RoI as second, is that surprising?
Glosses that competitiveness can come about through different routes- contrast, say, Singapore and the Nordics, or New Zealand. (Recognised by the Scottish Sustainable Growth Commission 2018.)

11. (4.) Policy/research implications
Some surprising features
Says, NI “will work” to increase equality and happiness as Denmark, pre-empts a lot of political dispute.
The entire analysis omits “culture” (except for one strange reference to Israel).

12. Thank you Questions and discussion
Dr Esmond Birnie