The long-term economic impact of leaving the EU

The aim of this paper is to analyse the long-term implications of leaving the EU for the UK economy. To do this, we consider three main channels by which the UK economy could be affected in the long run:

1) Reductions in trade with EU countries and a modest increase in tariff barriers.

2) A reduction in foreign direct investment (FDI), particularly affecting services FDI.

3) A reduction in the UK’s net fiscal contribution to the EU.