economic integration

Value chains and domestic competitiveness

With international trade increasingly undertaken within vertically fragmented supply chains, this paper considers the impact of changes in trade costs on domestic output. In the context of the UK’s exit from the EU we show that the negative impact on UK output will depend on changes in both domestic and export competitiveness. Since for many firms the majority of their sales are to the domestic market, the domestic competitiveness impact may be quantitatively more important.

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.