The changing contribution of tourism in a dynamic economy: The case of Ireland

The performance of the Irish economy has received considerable international commentary in recent years. The focus of this attention has generally been on how an economy with severe fiscal imbalances and endemic unemployment in the 1980s was transformed in the 1990s so that it exhibited phenomenal economic growth and employment gains. This paper argues that the turnaround in the fortunes of the Irish economy was due to the confluence of a number of endogenous and exogenous factors and explains that tourism, often overlooked by commentators, played an important role in the transformation. The paper focuses on the performance of tourism since the mid-1980s, outlines the sector's contribution in the macroeconomy and details some emerging concerns that must be addressed if the tourism industry is to continue to play an important role in the economy of Ireland.