Structural change in the Northern Ireland economy

Abstract

The notion that Northern Ireland's economic problems reflect, to a substantial degree, an adverse mix of industry — with too great an emphasis on declining or slow growing sectors — is now a commonplace, if partial, explanation of persistently high unemployment and low income levels. It is possible to recognise such features in the Northern Ireland economy since at least the 1920s although it was not until 'the Isles and Cuthbert Report' that a detailed articulation was presented of the relevance of industrial structure in explaining economic circumstances. The view that structural problems were one of the root causes of Northern Ireland's economic ills was firmly endorsed by the Wilson Report of 1965. There are, perhaps, three main issues that are posed in attempting, by analysis, to gauge the significance of the structural dimension: (i) What is the "quality" of the industrial structure? (ii) Has structure changed in a favourable or adverse fashion? (iii) What are the mechanisms of structural change? This paper attempts to address these issues using the shift-share technique supplemented with additional analyses.