The importance of Irish-owned and -run businesses such as dairy co-ops is not being reflected properly in how the economy is measured, according to Professor John Fitzgerald in last week’s ESRI report.

Neither gross domestic product (GDP) nor gross national income (GNI) properly reflect the performance of the Irish economy, he maintains, because they are calculated on sales. Multinational companies usually repatriate the profits from these sales, leaving only a relatively small percentage behind in the national economy.

Fitzgerald suggests a better measurement would be net national product (NNP), which would measure the performance of the economy based on the amount of wealth that is retained in Ireland. Therefore, an Irish-owned factory or creamery that sources raw material locally, employs local people and reinvests profits in the business makes a greater contribution overall and is a better reflection of the overall economic health of the country.