Economics of Brexit

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    The UK’s industrial supply chains are dependent on European manufacturers

The UK’s industrial supply chains are dependent on European manufacturers

What impact will Brexit have on UK manufacturing? As Bob Hancké points out, the domestic economic effects of Brexit are dynamic, not static. While some industries will be devastated by Brexit, resources may switch to other areas which, in theory, could thrive. But for this to happen, the UK needs to revamp its industrial supply chains, which are dependent on close links […]

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    Cabinet resignations and the Chequers proposal could destabilise the economy

Cabinet resignations and the Chequers proposal could destabilise the economy

The stability of UK economy is at a critical stage – now that Theresa May’s leadership may be challenged following high-profile Cabinet resignations, and depending on how the EU reacts to the ‘soft’ Brexit approach agreed at Chequers. Michael Ellington and Costas Milas (University of Liverpool) explain how the pound’s exchange rate and volatility go hand in hand with […]

The Brexit dividend: expect a lost decade of economic underperformance and political crisis

Contrary to some predictions, Britain’s economy has not crashed in the two years since the EU referendum. But growth has slowed markedly, productivity is down and investment is on hold. Dimitri Zenghelis (LSE) looks at the effect the prolonged uncertainty about future trade arrangements is having on the economy.

In September 2016, a few months after the UK referendum vote to leave […]

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    Two years after the vote, there is little certainty where the UK-EU relationship is heading

Two years after the vote, there is little certainty where the UK-EU relationship is heading

Two years after the vote, there is little certainty regarding the UK’s political and economic future. Brexiters themselves are split between wanting a Singapore-on-Thames or a Belarus-on-Trent. Simon Hix (LSE) assesses where the UK-EU relationship is heading. He argues that despite persisting uncertainty, a No Deal is the least-preferred option of both the UK or the EU27, and hence the least likely. He suggests […]

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    Might economists be partly to blame for Trump and the prospect of a hard Brexit?

Might economists be partly to blame for Trump and the prospect of a hard Brexit?

The reasons for the Trump phenomenon and Brexit vote are many and various. But have we overlooked ways in which standard economics, by failing to take seriously the radical uncertainty endemic in modern political economies, has contributed to the populist turn? Richard Bronk (LSE) argues that by mischaracterising their profession as able to make precise forecasts of uncertain futures – an […]

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    The devil is in the detail: multinationals favour the customs union

The devil is in the detail: multinationals favour the customs union

In a customs union, goods cross borders seamlessly, but in a free trade agreement, border checks are needed to ensure conformity with rules of origin. Paola Conconi (ULB/LSE) explains why a customs union is key for multinationals to stay in the UK after Brexit.

Some members of Theresa May’s cabinet are pushing for a ‘soft’ Brexit, which would allow the UK to remain close […]

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    Higher inflation, lower wages and decreasing output: Brexit is starting to negatively affect the UK economy

Higher inflation, lower wages and decreasing output: Brexit is starting to negatively affect the UK economy

The full economic consequences of the UK’s vote to leave the European Union will not be realised for many years. But as Thomas Sampson makes clear, two years after the referendum, we can already detect how Brexit is starting to affect the UK economy.

Brexit is yet to happen, but the economic effects of voting to leave are already being […]

Rule-takers and rule-makers: why TBTs are so crucial to Brexit

At the heart of the wrangling over Brexit is the question of how much regulatory autonomy the UK is prepared to concede in exchange for access to the Single Market. It is these technical barriers to trade (TBTs) that inhibit countries from exporting to each other. Hayden Goudy and Elisa Kempe (LSE) set out what the UK can realistically hope for and predict […]

A soft Brexit is a compromise that would please no one

The outcome of most negotiations is a compromise in which all sides cede some ground. But Iain Begg (LSE) argues that ‘soft’ Brexit cannot offer an enduring compromise between ‘Brexiteers’ and ‘Remainers’ because both will be so uncomfortable with it.

Split the difference. In most negotiations it is the three-word formula most likely to be adduced, obliging both sides to […]

Post-Brexit immigration policy: Scotland wants to go its own way

Britain does not yet have a post-Brexit immigration policy, and a likely shortage of lower-skilled workers poses a particular challenge. Sarah Kyambi (University of  Edinburgh) looks at how governments try to meet labour shortages and why Scotland is exploring ways to encourage migrants to settle permanently.

Despite the likelihood that free movement will end when the UK leaves the European […]