From ‘Tiger’ to ‘PIIGS’: Ireland and the use of heuristics in comparative political economy

Abstract

Acronyms for groups of countries provide an often useful shorthand to capture emergent similarities, and terms such as PIIGS, BRICs and LDCs pervade the lexicon of international and comparative political economy. But they can also lead to misleading narratives, since the grounds for use of these terms as heuristic devices are usually not well elaborated. This can become problematic when the use of such heuristics drives market responses in areas such as risk perception and changes in interest rates. In this paper we look at the narrative construction of the group of countries that has been grouped as 'PIIGS' (Portugal, Ireland, Italy, Greece, and Spain).We examine the process whereby the group came into being, trace how Ireland became a member of this grouping, and assess the merits of classifying these countries together. Our contention is that the repetition of the acronym in public debate shaped the behaviour of market

How Perceptions of Inequality Between Countries Diminish Trust in the European Union: Experimental and Observational Evidence

“…The recession seems to have placed member states on divergent economic paths, so much so that political analysts often refer to “core” and “periphery” economies within the Eurozone (cf. Brazys & Hardiman, ; Quiggin, ). While some countries have fared relatively well during the recession, others have experienced growing unemployment, poverty, and social exclusion.…”

Political Science and the Eurozone Crisis. A Review of Scientific Journal Articles 2004–15

“…Focussing on investors instead, the article by Eichler () already mentioned under the construction narrative deals with expectations concerning a sovereign default and/or withdrawal from the eurozone and, therefore, trust. Brazys and Hardiman () find that increased media usage of the acronym ‘PIIGS’ (designating Portugal, Ireland, Italy, Greece and Spain) correlates with the countries’ sovereign debt risk rating, such as increasing changes in Irish bond yields.…”

When do Heuristics Matter in Global Capital Markets? The Case of the BRIC Acronym

“…Julia Gray (2013) has focused on the use of a country's membership in specific international organisations as a cognitive shortcut that investors employ to assess a government's creditworthiness. Brazys and Hardiman (2015) have shown how the discursive inclusion of Ireland into the 'PIIGS' acronym affected the country's bond yield movements. And Brooks et al (2015) have found similar effects of various types of country groupings in a broader perspective.…”

“…As we do not expect any peer effects among non-BRIC countries, the group average for non-BRIC countries is set to zero. Secondly, similar to Brazys and Hardiman (2015), we use three alternative indexes that we derive from electronic media databases to proxy the salience of the BRIC-acronym in the financial press. The three ratios, illustrated graphically in Figure 1 (reassuringly they are highly correlated with each other), are: (i) the FACTIVA ratio, i.e.…”