SUMMARY Northern Ireland’s economic performance during the ‘golden age’ was weak. Crafts suggested that rent‐seeking was an important determinant of this poor record. This article offers support for such a conclusion. It is suggested that the growth record was shaped by British regulations preventing conflicts of ministerial interest not being made operational until 1963. This institutional divergence tended to promote rent‐seeking behaviour, which impeded the pursuit of an industrial policy that could promote economic efficiency. In 1963 the institutional structure and the industrial policy framework changed. These changes stimulated the pursuit of efficiency and contributed to an improved regional economic performance.

Northern Ireland has been characterised as having an excessively large public sector. This characterisation has led some to explain poor regional economic performance in terms of 'crowding out'. This diagnosis has been used to justify a policy of 'rebalancing' and the region copying its southern neighbour's lower rate of corporation tax. The experience of large public sectors in the Nordic economies seems however to suggest that higher public spending is not necessarily damaging. This argument is examined critically. Rodrik's comparative institutional analysis indicates that in the Nordics a large public sector was the result of building a successful tradable private sector rather than its cause. In terms of the possible 'economic dividend' from devolution we suggest that a Hayekian insight is better: no 'silver bullets' exist.JEL codes: O25, O52, R11, R50.

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Should the fiscal powers of the Northern Ireland Assembly be enhanced? Northern Ireland has been characterised by an inability to narrow the persistent economic gap relative to Britain. Some commentators have suggested that regional Corporation Tax variation may be the "game changer" in closing this gap. This paper draws on a range of papers that help us better understand the historical and institutional context. However, the analysis of tax variation is broader than this. Consideration is given as to which taxes might be the most suitable candidates for devolution. While greater tax variations could certainly complement an emphasis on increased competitiveness aimed at improving economic outcomes, they are no substitute for such a focus. As is often the case in institutional and economic development, issues of sequencing and policy capacity are salient.

Douglass North is a pivotal figure in the development of the 'new' economic history as well as the 'new' institutional economics. However, the relationship between these two aspects of his thinking remains undeveloped in previous critical assessments of North's work. The relationship is clarified here. The evidence presented indicates that three distinct phases can be distinguished in his writings between the 1950s and the 2000s. The paper relates these changing views to the shifting mainstream within economics and the effects that this shift has in turn had on economic history research. Economic history has adapted to economic research by abandoning some practices associated with the earlier cliometric literature. Furthermore, North is unique to the extent that his recent writings represent something of a convergence with 'old' institutionalism.Douglass North, economic history, institutional economics,