Professor Alan Barrett:

I will kick off on the Deputy's final point and then will hand over to Dr. Maev-Ann Wren and Dr. Kieran McQuinn.

On the issue of productivity, Deputy Broughan is correct. Mr. Martin Wolf has an article in The Financial Timesthis morning and he makes the point that productivity is everything. When one is talking about medium-term growth projections, there is an assumption that there will be productivity growth over time and that is what delivers living standard increases over the medium term. We are observing this productivity slowdown internationally which often comes as quite a surprise to people as everybody assumes that in the digital age with so much happening that productivity should be blasting ahead but it is not. If one brings that into Ireland the situation gets a little bit more complicated because we have this twin track economy. We have some incredibly productive companies, at least on paper, which are typically foreign owned and in contrast our core of domestic companies have much lower productivity levels. This is well understood and well discussed. There were two strands of ESRI research that tried to look at this recently; I referred in my introductory remarks to the fact that for quite a while we have been worried about under-investment in Irish SMEs. For quite a long time coming out of the recession the assumption, for which there was good evidence, was that this was about a restricted credit supply to these companies, given the difficulties with the banks. However, the most recent research would suggest that the under-investment in Irish SMEs is not related substantially to credit flows but is about something to do with risk appetite among Irish SMEs. That is clearly a concern. The second issue we have looked at recently goes to the following question and I will give 15 seconds to economic history. When Whitaker proposed models of foreign direct investment and the opening up of Ireland, the theory was always that the foreign direct investment companies would come into Ireland, that the domestic population would gain entrepreneurial management experience and over time there would be spillovers from the international sector to the domestic sector. In a sense this should have been a transition path. I have argued this on a number of occasions. I think that if TK Whitaker were still alive - perhaps he thought it in the later part of his life - he would have been surprised that 50 years to 60 years after his innovation we still had a relatively surprising dependence on foreign direct investment and what we increasingly see is that the sort of spillovers that were envisaged have not happened to the extent that we would have thought. Again the ESRI research on this has tried to identify which companies achieve these spillovers.

There needs to be a sufficient level of human capital within the company to be able to absorb the spillovers. We know something about the types of companies that do well here. Again - and I referred to this in the opening statement in the context of Brexit - we need to look at the domestic industrial sector and issues surrounding investment, human capital, managerial training and a range of other things, and a programme of work could then be done.

To come to the second point the Deputy raised, one of the most interesting studies we did within the institute last year was on the question why there are so few women in the upper echelons of the Civil Service. Both qualitative and quantitative research was carried out. One of the key findings of this was that men and women are as likely to be promoted when they apply but that the big difference between men and women across the Irish Civil Service is that men are much more likely to apply for promotion than women are. One of the qualitative pieces of research that came out of this made a point that I think everyone at one level knows, but it was interesting to see it written down. If a man satisfies two of five criteria specified for a job promotion, he applies; if a woman satisfies four out of the five, she tends not to apply. Again, there are a great many sociological reasons why this might apply.

Moving on, we have learned these barriers in the Civil Service. Again, there has been research that shows there are barriers elsewhere. There is broad international evidence that shows that the most productive workplaces are the most diversified. The first time I came across this literature was in the context of migration. It shows that diversified workforces tend internationally to be more productive. It is similar if there is an age distribution, the theory being that whatever problem one is confronting, the diversity of views tends to generate a more innovative approach to it. There could well be links between gender and productivity in Irish workplaces, but perhaps that is pushing it a little.

I will hand over to Dr. Wren, who will address the issue of health.