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Brexit: A “Hard but Smart” strategy and its consequences

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  • Gabriel Felbermayr

Abstract

A hard Brexit would be much more expensive for the UK than for the EU. With a “hard but smart” strategy, on the other hand, the UK would unilaterally forgo all new barriers, i.e. completely do away with import tariffs. As a result, there would be no substantial difference between the percentage welfare loss of the UK and that of the Continent. This fundamentally changes the negotiating situation. The analysis suggests that the EU Commission should not stubbornly cling to the withdrawal agreement, which is unacceptable for London, but should draw up constructive alternatives.

Suggested Citation

  • Gabriel Felbermayr, 2019. "Brexit: A “Hard but Smart” strategy and its consequences," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 72(04), pages 27-33, February.
    • Handle: RePEc:ces:ifosdt:v:72:y:2019:i:04:p:27-33
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    References listed on IDEAS

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    1. Berthold Busch & Jürgen Matthes, 2016. "Brexit: The Economic Impact – A Survey," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 17(02), pages 37-44, August.
    2. Gabriel Felbermayr & Jasmin Katrin Gröschl & Inga Heiland & Martin Braml & Marina Steininger, 2017. "Ökonomische Effekte eines Brexit auf die deutsche und europäische Wirtschaft," ifo Forschungsberichte, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 85.
    3. Gabriel Felbermayr & Jasmin Gröschl & Marina Steininger, 2022. "Quantifying Brexit: from ex post to ex ante using structural gravity," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 158(2), pages 401-465, May.
    4. Thomas Sampson, 2017. "Brexit: The Economics of International Disintegration," Journal of Economic Perspectives, American Economic Association, vol. 31(4), pages 163-184, Fall.
    5. Gabriel J. Felbermayr & Clemens Fuest & Hans Gersbach & Albrecht O. Ritschl & Marcel Thum & Martin T. Braml, 2019. "Hard Brexit ahead: breaking the deadlock," EconPol Policy Brief 12, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
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    Cited by:

    1. André Wolf, 2019. "Der Brexit aus EU-Perspektive [The Brexit from an EU perspective]," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 99(10), pages 739-740, October.

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    More about this item

    JEL classification:

    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

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