Miranda Xafa, 18 April 2018

The Brexit vote was a clear setback in the effort to integrate European capital markets. It slowed down the implementation of the Capital Markets Union agenda to avoid pre-empting the Brexit negotiations, and risks an inefficient break-up in the activities of clearing houses that deal in euro-denominated securities. This column, the second in a two-part series, argues that there is a strong case for the Capital Markets Union project to continue with the remaining EU27 members after Brexit, including stronger central oversight.

Swati Dhingra, Rebecca Freeman, Eleonora Mavroeidi, 30 March 2018

After Brexit, the UK will have to negotiate which provisions to include in its new arrangements, and a fundamental question is which provisions are most important in reducing non-tariff barriers to trade. This column uses a gravity model to show that trade agreements with deep provisions have the largest impact on domestic value added. The UK’s entry into a deep trade agreement with either the US or China/India that encompasses non-tariff liberalisation of services, investment, and competition can increase economic activity in industries that are key to its innovative activity.

Jonathan Portes, 06 April 2018

Much public and policy concern has focused on the distributional impacts of immigration – in particular, potential negative impacts on employment and wages for low-skilled workers. This column summarises evidence and draws conclusions from the now considerable literature on the impact of migration to the UK on the economy and labour market, including the potential economic impacts of Brexit-induced reductions in migration.


This one-day conference will bring together researchers and policymakers working on the economic consequences of Brexit. We invite submissions of papers and expressions of interest in attending. We would particularly welcome papers providing empirical evidence on the effects of the Brexit vote on the UK economy and novel studies of the potential future consequences of Brexit.

The conference will take place on September 19 in London and will be hosted by the Centre for Economic Performance at the London School of Economics. It is part of a series of events funded by the ESRC-sponsored UK in a Changing Europe initiative. The conference is open to attendees who are not presenting papers.

Submissions, requests for funding from PhD students and expressions of interest in attending the conference should be sent to [email protected] by May 18, 2018. Preliminary drafts of papers are welcome.

Harry Garretsen, Janka I. Stoker, Dimitrios Soudis, Ron Martin, Jason Rentfrow, 25 February 2018

The outcome of the UK’s referendum on EU membership came as a shock to most academic and policy experts. This column uses an extensive dataset of personality traits combined with socioeconomic data to show how the clustering of personality traits contributes to an understanding of the regional dispersion of the Brexit vote. Openness appears to be the trait that matters most – modest changes in this openness could actually have swung the vote across UK districts.

Andrés Rodríguez-Pose, 06 February 2018

Persistent poverty, economic decay and lack of opportunities cause discontent in declining regions, while policymakers reason that successful agglomeration economies drive economic dynamism, and that regeneration has failed. This column argues that this disconnect has led many of these ‘places that don’t matter’ to revolt in a wave of political populism with strong territorial, rather than social, foundations. Better territorial development policies are needed that tap potential and provide opportunities to those people living in the places that ‘don’t matter’.

Wen Chen, Bart Los, Philip McCann, Raquel Ortega-Argiles , Mark Thissen, Frank van Oort, 19 December 2017

Analyses of the impact of various types of Brexit at the national level hide a lot of regional economic heterogeneity. This column deploys a new interregional dataset to quantify the shares of regional labour income that are exposed to the implications of Brexit for trade, taking into account the indirect effects of supply chain relations. The results show that much more is at stake for UK regions than for the rest of the EU, with the exception of Ireland.

Giancarlo Corsetti, Meredith Crowley, Oliver Exton, Lu Han, 13 December 2017

As the recent UK Parliament Select Committee hearing revealed, there is a dearth of analysis of the sector-level risk to exports of a ‘no deal’ Brexit scenario. This column presents an analysis by sector and product, and delivers both good and bad news. In a scenario where trade reverts to WTO rules, the good news is that one-third of UK exports to the EU will remain tariff-free. The bad news is that one-quarter of exports will face high tariffs and/or the risk of restrictive quotas or antidumping duties.

Yann Algan, Sergei Guriev, Elias Papaioannou, Evgenia Passari, 12 December 2017

A wave of populism has been gaining ground in the West since 2012. This column uses regional data for 26 European countries to explore how the impact of the Great Recession on labour markets has affected populist voting, political attitudes, and trust. The results indicate a strong link between unemployment and voting for non-mainstream (especially populist) parties. Unemployment is also correlated with increasing distrust of national and European parliaments.

Benjamin Born, Gernot Müller, Moritz Schularick, Petr Sedláček, 28 November 2017

It is hard to calculate the current cost of Brexit, because there is no obvious counterfactual. This column calculates the cost by letting a matching algorithm determine which combination of comparison economies best resembles the pre-referendum growth path of the UK economy. The difference in output between the UK economy and its synthetic doppelganger adds up to a loss of 1.3% of GDP, or close to £300 million per week, since the vote took place. This implies a cumulative cost of more than £60 billion by the end of 2018.

Andrew Powell, 25 November 2017

The recent interest rate rise in the UK occurred despite negative economic news. This is not what conventional inflation-targeting policy would imply. This column argues that recent Latin American experience suggests the theory underlying inflation targeting may need to be reconsidered. Specifically, for small open economies, the role of the exchange rate and inflation expectations should be considered when deciding how to react. 

Mario Blejer, Piroska Nagy-Mohacsi, 22 November 2017

Global politics of late has been marked by the rise of anti-elite political movements and anti-establishment leaders. This column analyses the tactics of such populists through the lens of the ‘time inconsistency’ problem – that what is considered a long-term optimal policy today may not be optimal when that future arrives. Populist leaders seek to gain and increase their power by undermining democratic institutions and conventional commitment devices. Several ‘second generation’ institutional commitment devices to counter this are proposed.

Holger Breinlich, Elsa Leromain, Dennis Novy, Thomas Sampson, 20 November 2017

On 23 June 2016, the UK voted to leave the EU. As soon as the result became clear, sterling depreciated sharply and, since the vote, UK inflation has dramatically increased. This column asks how much of the rise in inflation is due to the referendum. It finds that the referendum result pushed up UK inflation by 1.7 percentage points, which amounts to an annual (and potentially permanent) cost of £404 for the average British household.

Mario Monti, 14 November 2017

The Anglo-Saxons have been admired for their sense of rationality. However Mario Monti talks about recent political events that completely changed the situation. This video was recorded at the "10 years after the crisis" conference held in London, on 22 September 2017.

Hylke Vandenbussche, William Connell, Wouter Simons, 27 November 2017

Global value networks make it difficult to evaluate the trade impact of Brexit. Using a new model of trade that accounts for the indirect effect of these networks, this column delivers fresh bad news for the UK, and for the rest of Europe. Brexit cuts GDP more, and costs more jobs, if we also consider global value chains. A hard Brexit would destroy four times as much GDP, and four times as many jobs throughout Europe, as a soft Brexit.

Wilhelm Kohler, Gernot Müller, 08 November 2017

The EU’s position in the Brexit negotiations is based on the premise that the four freedoms of the single market – goods, capital, services, and labour – are indivisible. This column argues that this indivisibility claim has no economic foundations, and that negotiating on this premise risks unnecessary harm. Reintroducing trade barriers will inflict damage on both sides of the Channel. The possibility that abandoning indivisibility may cause harm through cherry picking, or through potential further exits, doesn’t justify a hard Brexit scenario.

Hiau Looi Kee, Alessandro Nicita, 22 October 2017

More than a year has passed since the UK voted for Brexit. This column analyses the short-term fallout of trade in goods due to potential changes in trade policies. It argues that if the UK fails to secure a new trade deal with the EU and must face tariffs with no preferences, total UK's exports to the EU would drop by at most 2%. The impact is small because the EU's import demand for UK exports is fairly inelastic, especially for products that that may face higher tariffs.

Thomas Sampson, 19 October 2017

While we can estimate the economic impact of Brexit, we do not yet understand what made people vote for it. This column argues that political pro-Brexit rhetoric conflates two distinct hypotheses that have different policy implications. If voters wanted to reclaim sovereignty from the EU, they may view a negative economic impact as a price worth paying. But, if 'left-behind' voters blamed the EU for their economic and social problems, post-Brexit policy should focus on the underlying causes of discontent.

Federica Liberini, Andrew Oswald, Eugenio Proto, Michela Redoano, 17 October 2017

There has been much debate on the determinants of the vote for Brexit. This column uses newly released data from the Understanding Society study to examine the characteristics of individuals who were for and against Brexit. Unhappiness contributed to the vote to leave the EU, but this was driven by feelings about individual financial situations rather than a general dissatisfaction with life. Brexit does not appear to have been caused by the old – only those under the age of 25 were substantially pro-Remain.  

Nicholas Bloom, Paul Mizen, 05 October 2017

UK economic performance has been poor since the vote to leave the EU in June 2016, but has not been the catastrophe that many predicted. This column draws four results from the evidence gathered in the new Decision Maker Panel survey of around 2,500 businesses in the UK. While most firms expect a negative impact of Brexit on sales, investment and costs, only larger firms and those that are more exposed to international markets are likely to think that they might move part of their business abroad.



CEPR Policy Research