Open economies tend to grow faster than relatively closed ones, lowering prices and providing jobs.3 *** Turning to home, Ireland offers an example of a small economy that benefits greatly from openness. Ireland went from being one of the poorer members of the European Union on joining to, today, being one of the most prosperous.
The first part of my remarks will focus on the benefits to Ireland of being a highly globalised economy. While the second part will look at the vulnerability of the Irish economy due to its openness. Finally, I will reflect on what we can do as a central bank to build resilience to the vulnerabilities associated with being small, open and highly globalized.