Brexit

The Economic Effects of the Government’s proposed Brexit Deal

Read Garry Young's note on the methodology behind this report here.

 

This report estimates the economic effects of the government’s proposed Brexit deal that was first published on 14 November 2018, and subsequently expanded.

Brexit and the UK's Services Trade

New research by the National Institute of Economic and Social Research (NIESR), commissioned by the Tony Blair Institute for Global Change.

Read the report here

Post-Brexit Immigration Policy: Reconciling Public Perceptions with Economic Evidence

Funded by the Leverhulme Trust, researchers from NIESR and Birkbeck explored public attitudes to EU immigration and how people use and respond to evidence on the economic impacts of immigration. Based on 12 focus groups with 105 participants in a Leave voting area of the UK, the report tests out ways of getting people to consider the economic evidence. In addition to survey and focus group findings, the report contains a comprehensive literature review on public attitudes towards immigration as well as on the economic impacts of EU immigration in the UK.

Our main findings are:

Measuring the permanent costs of Brexit

We analyse the costs of Brexit. The results show that by 2030 a hard Brexit would reduce cumulative GDP growth by 18 percentage points compared to a situation where the UK continued its EU membership. The economic damage in our FTA and soft Brexit scenarios is less severe than in our hard Brexit scenario, although it will still cost the UK economy roughly 12.5 percentage points and 10 percentage points of cumulative GDP growth by 2030, respectively. We find much larger negative effects than most existing studies that use macroeconometric modelling to assess the effects of Brexit.

Local economic effects of Brexit

This paper studies local economic impacts of the increases in trade barriers associated with Brexit. Predictions of the local impact of Brexit are presented under two different scenarios, soft and hard Brexit, which are developed from a structural trade model. Average effects are predicted to be negative under both scenarios, and to be more negative under hard Brexit. The spatial variation in negative shocks across areas is higher in the latter case as some local areas are particularly specialised in sectors that are predicted to be badly hit by hard Brexit.

Will Brexit raise the cost of living?

This paper considers two aspects of this question. First, Brexit has already induced a devaluation of sterling of around 14 per cent since June 2016, which has started to work through to consumer prices: between June 2016 and July 2017 consumer prices increased by around 2.5 per cent. Second, while it is not government policy, nor the desire of the UK public, that the outcome of negotiations is a ‘MFN Brexit’, this remains a distinct possibility. Thus we ask how the imposition of tariffs on imports from the EU will work through into consumer prices.

Brexit and the UK automotive industry

The UK’s automotive industry has been one of the ‘star performers’ of the UK economy in recent years – unlike most other manufacturing sectors. Output has increased by over 60 per cent since 2010 and there has been over £8 billion worth of investment in the industry in the past five years. The industry supports some 800,000 jobs in the UK. It is seen as having benefitted from EU membership. So what might Brexit mean for the UK automotive sector, and its workers?

The Autumn Statement: A Macro Perspective

The change of Chancellors has brought change in direction for fiscal policy. Ex-Chancellor Osborne argued that given the level of debt, austerity and a fiscal straight-jacket were necessary to maintain economic and financial confidence. Chancellor Hammond faces even higher debt levels and more uncertainty, but chose to reduce austerity and opt for a non-binding fiscal rule.

The UK and EU foreign, security and defence policy after Brexit: integrated, associated or detached

None of the existing models for the future trade policy relationship between the UK and the EU come with a predetermined foreign and security policy relationship. This article assesses how the future EU-UK foreign and security policy relationship might be organised post-Brexit. It provides evaluation of the current EU-UK interrelationship in the fields of the EU’s Common Foreign and Security Policy (CFSP) and Common Security and Defence Policy (CSDP) and assesses the degree to which the UK is presently integrated into EU decision-making and implementation.

Negotiating the UK’s post-Brexit trade arrangements

This paper considers the agenda for UK trade negotiations over the post-Brexit period. There are several groups of countries that will need to be dealt with and we consider the priorities among them. Negotiations with the WTO and the EU are the most important and the most pressing in time, and should be pursued simultaneously. On the former, the UK must try quickly to establish its independent WTO status, which will be greatly facilitated by minimising the changes it proposes to its tariffs schedules.

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