Scotland's politicians are scrambling to piece together a coalition government after last week's photo-finish election; but when the dust settles in Holyrood, whoever takes charge will have to answer tough questions about Scotland's economic future.
With its heavy reliance on public spending, and oil and gas output already past its peak, Scotland is in need of an economic renaissance. For the Scottish Nationalists, who pipped Labour to the post by a single seat, floating free of the rest of the UK is the answer - and Ireland, the 'Celtic tiger', provides an alluring blueprint for success.
Much of Scotland is far from tiger-like. Despite its history as an economic powerhouse, it suffered badly from the early Eighties onwards, when Britain's manufacturing sector began its long, painful decline. Angry resentment about oil revenues flowing south to Westminster increased the bitterness of workers laid off in their thousands.
By the second half of the Nineties, a thriving financial services industry and a flood of investment from foreign hi-tech firms into what became known as 'Silicon Glen' was helping to boost Scotland's performance. When the dotcom downturn came after 2001, Scotland was badly affected, and its growth rate has continued to lag the rest of the UK.
The SNP believes the key to future economic success is using the tax-powers that would come with independence to slash corporation tax, attract more foreign investment and kick-start economic growth. During a bitter election campaign, they tempted voters with the prospect of following Ireland's lead.
Seizing the tax revenues from Scotland's offshore oil and gas fields, and using them to help offset the loss of taxpayer subsidies from London, has long been at the heart of the SNP's programme; but they also promised to stoke faster economic growth and, since devolution in 1999, have looked across to Ireland for economic inspiration.
The Irish model looks impressive, but with an increasing number of countries now cutting their corporation tax rates, including the low-cost economies of eastern Europe, the battle for investment is harder to win. 'They would be johnny-come-latelies,' says Professor Brian Ashcroft, of Strathclyde University, who studies the Scottish economy.
Sheila Killian of Limerick University says a scrabble to cut corporation tax rates is only a short-term fix. 'The problem is that it's not a sustainable strategy. Wages have gone up; costs have gone up; it's become a more expensive place to operate, and the companies that have come because taxes are low are now going somewhere else.'
Relying heavily on a small number of multinationals, most of them American firms such as Dell and Intel, has also tended to skew Ireland's politics, Killian argues. 'The low corporate tax rate takes a certain mentality.' Maintaining a business-friendly low-tax, light-regulation environment, while providing generous public services, is tough. 'It's difficult to combine the two political ideologies.'
Ireland has consciously sought to adopt a US-style, pro-enterprise approach. Former finance minister Mary Harney said that Ireland was 'closer to Boston than Berlin'.
With an election coming up later this month, however, Irish politicians are now formulating policies to nurture home-grown entrepreneurs, as well as attract foreign investors. 'It's only now that the political parties are thinking, "perhaps we should do something for smaller businesses",' Killian says.
When it began its dash for growth, Ireland was also lagging much farther behind the rest of the UK than Scotland does now. With its long-established financial services sector, and a number of promising new industries, including life sciences and renewable energy, Scotland already attracts more inward investment than any other region of the UK, apart from London and the south east. On output per head, too, it is not too far behind the south of England.
Dougie Adams, economic adviser to the Ernst and Young Scottish Item Club, says the stereotype of Scotland as a post-industrial wasteland of rusting shipyards and sink estates is out of date. Since 1997, 260,000 jobs have been created, and the employment rate is now higher than the rest of the UK. 'Scotland's a rich, prosperous place. Rural Scotland's suffering, but rural Wales is suffering, and I suspect rural Somerset is suffering too.'
Ashcroft agrees. 'There's more similarity between Scotland and the rest of the UK than there is difference; and where there are differences, a lot of it is driven by history, and geography.' Scotland has 8 per cent of the UK's population, strung out across 38 per cent of its landmass. Delivering public services in the Highlands and Islands, for example, is inevitably expensive.
Edinburgh has had a strong financial services sector for many years, with venerable firms such as the Royal Bank of Scotland; but Glasgow, too, where businesses can qualify for state financial support, is now attracting banks and insurers.
'The financial services sector has grown extremely well in Scotland over the past six to seven years,' says David Smith, of Scottish Development International. He points to a fast-growing life sciences sector as another success. Like Ireland, Scotland has begun to stem the traditional exodus of young people, with migration from Eastern Europe and the rest of the UK. Abandoning the union need not be a pre-requisite for an economic resurgence. Ashcroft says there is plenty a new Holyrood government of any colour could do to stimulate a healthier Scottish economy, without winning independence from Westminster.
'The Scottish Executive has considerable powers: in terms of spending, in terms of legislation, there are all sorts of things you can do - on bankruptcy law and so on; policies to stimulate innovation and R&D - most of those levers lie here.'
Ashcroft believes Gordon Brown could ease some of the pressure for economic separatism by allowing Edinburgh to set its own corporate tax rates - so that just as young couples used to elope to Gretna Green to take advantage of Scotland's more liberal marriage laws, companies might be encouraged to look north for investment opportunities. 'This is a government that argues for tax competition within Europe, but wants to stop that at our borders.'
Some experts believe relying on foreign investment could also leave Scotland vulnerable to a downturn. When the dotcom bubble burst, Ireland's economy, dependent on a small number of electronics giants, slowed more sharply than Scotland's, which was helped by the flow of public spending from London. 'You're open to the possibility that you might get a very fast growth rate; but equally, you're very open to external shocks,' says Ashcroft.
Judging by the SNP's narrow victory last week, Scotland's voters may be willing to take their chances.