The one country that routinely appears in the list of positive cases of expansionary austerity is Ireland in the late 1980s. Going back to the discussion in "Tales," Alesina and Ardanga narrate Ireland's experience from 1987–1989 as follows. When Irish debt to GDP reached 116 percent in 1986, a right-wing government came to power that cut transfers, the government wage bill, and taxes. Devaluation and negotiated wage moderation reduced unit labor costs by 12 to 15 percent. Growth rates and foreign investment both soared. Key to all this, as before, was the large expenditure-based cut plus wage moderation and devaluation.

Mark Blyth, Austerity, loc. 565