One of the Pin's regular posters has pointed out a few times over the last few days that Ireland's GNP is the same as Germany's. Turns out it's pretty much true: http://www.google.com/publicdata/explor ... ta+irelandhttp://www.google.com/publicdata/explor ... ta+germany
It has also been pointed out that average house prices in Ireland and Germany are about the same. Again, from Googling a bit it seems that's also correct, broadly speaking.
Now, to me, this is absolutely ridiculous. But I can't quite work out an explanation nor properly rebut these statistics, beyond saying that it is prima facie absurd.
Can anyone explain how a bankrupt country being run by the IMF has the same GNP per capita and average house prices as one of the richest countries in the world and the economic powerhouse of Europe?
A countries GNP per head gives no clue to its governments finances. Because Irelands government is running a large deficit (tax expenditure much higher than tax revenue) has no direct effect on business's like Ryanair, CRH, and the multinational companies that employ thousands of Irish people who's wages all add to Irelands GNP. Ireland government is ''bankrupt'' because bond markets are not willing to lend us money due to uncertainty of our banks and the deficit being so high.
You refer to Germany being a powerhouse, this term is used because of the size of their economy, they have 80 million people, we have 4.5 million, so even if GNP per capita is the same their economy is still going to be about 18 times are size and the biggest in Europe. Germanys debt to GDP ratio is 83% which is still very high by international standard but the major difference is their not running a huge defcit (less than 3%) at the moment so their debt ratio is not rising unlike Irelands. Irelands budgets of 2009/10 each took 4.5 billion out of the economy but GDP remained the same since then. Ireland can close its deficit by 2015 (terms of the bailout) by more budget cuts without GDP falling. were a small open economy where the government does not make up a huge amount of our economy, so government cuts can be offset by growth else where in the economy.
Also the stats on GNP you gave link to are measured in PPP (takes into account cost of living in different countries) which is the reason for Irelands and Germany having a considerable difference, if they were measured in nominal terms they would be far closer.