Author(s): Iain Begg
Date published: May 2019
SUERF Policy Note, Issue No 70
By Iain Begg, London School of Economics
JEL-codes: E61, E65, F15, F45, F55.
Keywords: Brexit economic impact, UK-EU relations, Costs and benefits of economic integration, UK growth, UK public finances.
This article provides an overview of the likely economic consequences for the United Kingdom of leaving the European Union. Drawing on a variety of sources espousing diverse analytic approaches, the evidence of an adverse economic effect from Brexit is shown to be persuasive. In the short term, the UK economy has under-performed since the beginning of 2017, although the labour market has been robust. Despite the anticipated savings from reduced payments to the EU budget, the UK’s public finances are likely to deteriorate because lower tax revenue will more than offset the direct savings. In the longer term, downside risks to the economy are expected to dominate.
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