In This Review

The Fall of the Celtic Tiger: Ireland and the Euro Debt Crisis
The Fall of the Celtic Tiger: Ireland and the Euro Debt Crisis
By Donal Donovan and Antoin E. Murphy
Oxford University Press, 2013, 256 pp.

Although its subject matter and the text itself are a bit dry, this book is the best so far on the Irish financial crisis of 2008. The authors trace the well-known contours of the financial crisis that swept over Ireland, the government’s response, and the debate that has followed. They explain how an investment boom triggered a housing bubble. When the bubble burst, it took the banking sector with it. Private actors were at best shortsighted and at worst criminal, and public authorities, notably the Central Bank of Ireland, failed to discharge their regulatory duties. The fact that during the boom, politicians failed to push against the irrational optimism of the financial sector reflects the cozy personal style of Irish politics. The media and economists failed to inform the public about the growing risks. The authors conclude that the government had no practical alternative to issuing a much-criticized comprehensive bank guarantee, which, combined with irresponsible government borrowing and spending during the boom years, quickly fueled public-sector deficits.