Skip to content
Licensed Unlicensed Requires Authentication Published by De Gruyter December 13, 2019

No Longer “The Economy Stupid”: How Muddled Economics Contributed to a Chaotic Brexit

  • Iain Begg EMAIL logo
From the journal The Economists’ Voice

Abstract

The Faustian bargain at the heart of Brexit can be portrayed as a trade-off between enhanced control and economic benefits. Most commentators expect the UK economy to take some sort of hit from leaving the UK, but in the words of one prominent ‘leave’ supporter, it would be a ‘price worth paying’, to regain control over decision-making.[2] For convinced Brexiteers, a UK unshackled from the EU will rapidly transform itself to be able to take advantage of opportunities in emerging markets and other dynamic parts of the global economy, while ‘remainers’ see distancing the UK from its largest market as an egregious act of self-harm. Both sides have been culpable of misleading statements. Similar dissembling occurred in relation to the public finances. The article explores how competing, poorly understood and often incoherent interpretations of economic propositions fed into Brexit, leading to misguided policy decisions and confusion in the debates around how to reset the UK’s economic relationship with the EU.

References

Armstrong, K. A. 2018. “Regulatory Alignment and Divergence After Brexit.” Journal of European Public Policy 25 (8): 1099–1017.10.1080/13501763.2018.1467956Search in Google Scholar

Bachtler, J., I. Begg, M. Ferry, and J. Ogilvie. 2019. Ex-post Evaluation of the European Union Solidarity Fund, Report to DG Regio of the European Commission, https://ec.europa.eu/regional_policy/sources/docgener/evaluation/pdf/eusf_2002_2016/eusf_2002_2016_final_en.pdf.Search in Google Scholar

Bank of England. 2018. “EU withdrawal scenarios and monetay and financial stability: A response to the House of Commons Treary Committee.” London Bank of England. https://www.bankofengland.co.uk/-/media/boe/files/report/2018/eu-withdrawal-scenarios-and-monetary-and-financial-stability.pdf?la=en&hash=B5F6EDCDF90DCC10286FC0BC599D94CAB8735DFB.Search in Google Scholar

Begg, I. 2016. “The EU Budget and UK Contribution.” National Institute Economic Review 236: 39–47.10.1177/002795011623600106Search in Google Scholar

Begg, I. 2017. “Making Sense of the Costs and Benefits of Brexit: Challenges for Economists.” Atlantic Economic Journal 45 (3): 299–315.10.1007/s11293-017-9550-xSearch in Google Scholar

Belke, A., and D. Gros. 2017. “The Economic Impact of Brexit: Evidence from Modelling Free Trade Agreements.” Ruhr Economic Paper No. 700 http://www.rwi-essen.de/media/content/pages/publikationen/ruhr-economic-papers/rep_17_700.pdf.Search in Google Scholar

Born, B., G. Müller, M. Schularick, and P. Sedlacek. 2019. “£350 million Per Week: The Output Cost of the Brexit Vote.” Voxeu, https://voxeu.org/article/300-million-week-output-cost-brexit-vote.Search in Google Scholar

Bovens, M., and P. ‘t Hart, 2016. “Revisiting the Study of Policy Failures.” Journal of European Public Policy 23 (5): 653–666.10.1080/13501763.2015.1127273Search in Google Scholar

Cameron, D. 2019. For the Record. London: William Collins.Search in Google Scholar

Campos, N. 2019. “The Economics of Brexit.” The New Palgrave Dictionary of Economics Onlinehttps://link.springer.com/referenceworkentry/10.1057/978-1-349-95121-5_3079-1.10.1057/978-1-349-95121-5_3079-1Search in Google Scholar

Chaney. T. 2018. “The Gravity Equation in International Trade: An Explanation.” Journal of Political Economy 126 (1): 150–177.10.1086/694292Search in Google Scholar

Daddow, O. 2012. “The UK Media and ‘Europe’: From Permissive Consensus to Destructive Dissent.” International Affairs 88 (6): 1219–1236.10.1111/j.1468-2346.2012.01129.xSearch in Google Scholar

De Lyon, J., and S. Dhingra. 2019. “Economic Performance since the EU Referendum.” Centre for Economic Performance Paper CEPBREXIT14, http://cep.lse.ac.uk/pubs/download/brexit14.pdf.Search in Google Scholar

De Ville, F., and G. Siles-Brügge. 2019. “The Impact of Brexit on EU Trade Policy.” Politics and Governance 7 (3): 7–18.10.17645/pag.v7i3.2102Search in Google Scholar

Dhingra, S., G. Ottaviano, T. Sampson, and J. Van Reenen. 2016. “The Impact of Brexit on Foreign Investment in the UK.” Centre for Economic Performance Paper CEPBREXIT03, http://cep.lse.ac.uk/pubs/download/brexit03.pdf.Search in Google Scholar

Dhingra, S., H. Huang, G. Ottaviano, J. P. Pessoa, T. Sampson, and J. Van Reenen. 2017. “The Costs and Benefits of Leaving the EU: Trade Effects.” Centre for Economic Performance Discussion Paper 1478, http://cep.lse.ac.uk/pubs/download/dp1478.pdf.10.1093/epolic/eix015Search in Google Scholar

Ebell, M. 2016. “Assessing the Impact of Trade Agreements on Trade.” National Institute Economic Review 238: R31–R42.10.1177/002795011623800113Search in Google Scholar

Economists for free trade. 2018. “What if we can't agree? Why a world trade deal exit from the EU will be best for the UK.” https://www.economistsforfreetrade.com/wp-content/uploads/2018/06/Why-a-World-Trade-Deal-exit-from-the-EU-may-be-best-for-the-UK-Final-15.06.18.pdf.Search in Google Scholar

Emmerson, C., P. Johnson, I. Mitchell, and D. Phillips. 2016. Brexit and the UK’s Public Finances, Report No. 116. London: Institute for Fiscal Studies.10.1920/re.ifs.2016.0116Search in Google Scholar

Felbermayr, G., J. Gröschl, and M. Steininger. 2018. “Quantifying Brexit: From ex post to ex ante using Structural Gravity.” CESifo Working Paper 7357, https://www.cesifo.org/DocDL/cesifo1_wp7357.pdf.Search in Google Scholar

Gudgin, G., K. Coutts, N. Gibson, and J. Buchanan. 2017. “The Role of Gravity Models in Estimating the Economic Impact of Brexit.” Centre for Business Research, University of Cambridge Working Paper No. 490 https://www.cbr.cam.ac.uk/fileadmin/user_upload/centre-for-business-research/downloads/working-papers/wp490.pdf.Search in Google Scholar

HM Government. 2018. “EU exit: Long-Term Economic Analysis.” Cm 9742, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/760484/28_November_EU_Exit_-_Long-term_economic_analysis__1_.pdf.Search in Google Scholar

HM Treasury. 2015. “EU Finances 2015: Statement on the 2015 EU Budget and Measures to Counter Fraud and Financial Mismanagement.” Cm 9167, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/483344/EU_finances_2015_final_web_09122015.pdf.Search in Google Scholar

HM Treasury. 2016. “HM Treasury Economic Analysis: The Immediate Economic Impact of Leaving the EU.” Cm 9292, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/524967/hm_treasury_analysis_the_immediate_economic_impact_of_leaving_the_eu_web.pdf.Search in Google Scholar

House of Commons Treasury Committee. 2016. “The Economic and Financial Costs and Benefits of the UK’s EU Membership.” First Report of Session 2016–17, HC 122 https://publications.parliament.uk/pa/cm201617/cmselect/cmtreasy/122/122.pdf.Search in Google Scholar

House of Lords European Union Committee. 2017. Brexit and the EU Budget, 15th Report of 2016–17 session, London House of Lords, https://publications.parliament.uk/pa/ld201617/ldselect/ldeucom/125/125.pdf.Search in Google Scholar

Lawless, M., and E. L. W. Morgenroth. 2019. “The Product and Sector Level Impact of a Hard Brexit Across the EU.” Contemporary Social Science 14 (2): 189–207.10.1080/21582041.2018.1558276Search in Google Scholar

Office for Budget Responsibility. 2018. “Economic and Fiscal Outlook.” Cm 9713, https://cdn.obr.uk/EFO_October-2018.pdf.Search in Google Scholar

Rosamond, B. 2019. “Brexit and the Politics of UK Growth Models.” New Political Economy 24 (3): 408–421. https://www.tandfonline.com/doi/full/10.1080/13563467.2018.1484721.10.1080/13563467.2018.1484721Search in Google Scholar

Sampson, T. 2017. “Brexit; The Economics of International Dis-Integration.” Journal of Economic Perspectives 31 (4): 163–184.10.1257/jep.31.4.163Search in Google Scholar

Sampson, T., S. Dhingra, G. Ottaviano, and J. Van Reenen. 2016. “Economists for Brexit: A Crtique.” Centre for Economic Performance Paper CEPBREXIT06, http://cep.lse.ac.uk/pubs/download/brexit06.pdf.Search in Google Scholar

Schön, D. A., and M. Rein. 1994. Frame Reflection Toward the Resolution of Intractable Policy Controversies. New York: Basic Books.Search in Google Scholar

Springford, J. 2019. “The Cost of Brexit to December 2018.” Centre for European Reform Insight, March 2019, London: CER https://www.cer.eu/sites/default/files/insight_JS_29.3.19.pdf.Search in Google Scholar

Tetlow, G., and A. Stojanovic. 2018. “Understanding the Economic Impact of Brexit.” Institute for Government, https://www.instituteforgovernment.org.uk/sites/default/files/publications/2018%20IfG%20%20Brexit%20impact%20%5Bfinal%20for%20web%5D.pdf.Search in Google Scholar

UK in a Changing Europe. 2018. “What would ‘Trading on WTO Terms’ mean for the UK?.” http://ukandeu.ac.uk/wp-content/uploads/2018/12/What-would-trading-on-WTO-terms-mean-Long-Guide.pdf.Search in Google Scholar

UK in a Changing Europe. 2019. “No Deal Brexit: Issues, Impact, Implications.” https://ukandeu.ac.uk/wp-content/uploads/2019/09/No-deal-Brexit-issues-impacts-and-implications-1.pdf.Search in Google Scholar

Vandenbussche, H. 2019. “Sector-Level Analysis of the Effects of Brexit on the EU 28.” Report prepared for Flanders Department of Foreign Affairs, Belgium, https://www.fdfa.be/sites/default/files/atoms/files/Brexit%20impact%20study%202019.pdf.Search in Google Scholar


Supplementary Material

The online version of this article offers supplementary material (DOI: https://doi.org/10.1515/ev-2019-0030).


Published Online: 2019-12-13

© 2019 Walter de Gruyter GmbH, Berlin/Boston

Downloaded on 28.3.2024 from https://www.degruyter.com/document/doi/10.1515/ev-2019-0030/pdf
Scroll to top button