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The Risks of Hard Brexit for the United Kingdom

Author

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  • Perri Salvatore

    (Magna Graecia University of Catanzaro, Catanzaro, Italy)

Abstract

The aim of this paper is to analyze the potential consequences of Hard Brexit for the economy of the United Kingdom. From the theoretical and empirical literature, there are no reasons to expect good performances in the medium long term for the British economy. The Hard Brexit scenario will damage the UK perspectives of growth by increasing costs of production, difficulties to export, a quantitative and qualitative deterioration in labor force, the escape of financial operators and of the legal offices of multinationals from the London square, the isolation of UK in the international geopolitical context and riskiness for the same integrity of United Kingdom. After the vote, we can observe a resilience of the UK economy that could be determined by the accumulation of stocks in anticipation of a traumatic exit, but also, to an important depreciation of pound that is producing inflation and losing value of real wages.

Suggested Citation

  • Perri Salvatore, 2019. "The Risks of Hard Brexit for the United Kingdom," The Economists' Voice, De Gruyter, vol. 16(1), pages 1-8, December.
  • Handle: RePEc:bpj:evoice:v:16:y:2019:i:1:p:8:n:10
    DOI: 10.1515/ev-2019-0025
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    References listed on IDEAS

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    1. Busch, Berthold & Matthes, Jürgen, 2016. "Brexit - the economic impact: A meta-analysis," IW-Reports 10/2016, Institut der deutschen Wirtschaft (IW) / German Economic Institute.
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    3. Swati Dhingra & Hanwei Huang & Gianmarco Ottaviano & João Paulo Pessoa & Thomas Sampson & John Van Reenen, 2017. "The costs and benefits of leaving the EU: trade effects," Economic Policy, CEPR;CES;MSH, vol. 32(92), pages 651-705.
    4. Sascha O Becker & Thiemo Fetzer & Dennis Novy, 2017. "Who voted for Brexit? A comprehensive district-level analysis," Economic Policy, CEPR;CES;MSH, vol. 32(92), pages 601-650.
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    More about this item

    Keywords

    Brexit; economic policies; global economy; international finance; international trade;
    All these keywords.

    JEL classification:

    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions
    • F10 - International Economics - - Trade - - - General
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions

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