Prospects for the UK Economy

Hantzsche, Arno; Kara, Amit; Young, Garry

doi:10.1177/002795011824600103

Cited by 6 publications

(4 citation statements)

References 12 publications

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“…Our modelling approach builds on work published by NIESR prior to the referendum (Ebell, Hurst, & Warren, 2016;Pain and Young, 2004) and in response to proposals subsequently put forward by the British government Hantzsche, Kara, Lenoel, & Piggott, 2018;Hantzsche, Kara, & Young, 2018). We model the economic impact of the government's proposed Brexit deal as the combined result of different Brexit-related shocks to the economy, namely, through trade, foreign direct investment, net migration, productivity and contributions to the EU budget.…”

Section: Modelling the Brexit Dealmentioning

confidence: 99%

The economic effects of the UK government's proposed Brexit deal

2019

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The focus of our analysis is on how the UK government's proposed Brexit deal is likely to affect the economy. First, we assess how trade, migration, foreign direct investment, productivity and contributions to the EU budget might change by reviewing current proposals against historical evidence. Second, we use the National Institute Global Econometric Model (NiGEM) to analyse the macroeconomic effects. Our assessment is that trade with the EU, especially in services, would be more costly after Brexit. This would be likely to have adverse effects on living standards in the UK. Our central estimate is that if the government's proposed Brexit deal is implemented, then GDP in the longer term will be around 3% lower per head than it would have been had the UK stayed in the EU. If the UK were to stay in a customs union with the EU, or if the Irish backstop position was to be invoked, there would still be a hit to GDP per capita of 2%. These estimates represent our considered view of the economic impact of the government's proposed Brexit deal, but they are themselves uncertain as there is no historical precedent of a country leaving a major trading block such as the EU.

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Section: Modelling the Brexit Dealmentioning

confidence: 99%

The economic effects of the UK government's proposed Brexit deal

2019

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“…These challenges have been analysed using the NiGEM model: a macroeconomic framework that is internally consistent, robust and built on micro-theoretic foundations (Hantzsche et al, 2018). NiGEM is a multi-country macroeconometic model of the global economy that is data driven in the short to medium term and neoclassical in the long term.…”

Section: Resultsmentioning

confidence: 99%

“…The macro scenario used for this analysis is the NIESR November 2018 central forecast discussed in Hantzsche et al (2018). It is conditional on a 'soft' Brexit, broadly an assumption that the UK would trade on similar terms with the EU after Brexit as it had when it was an EU member.…”

Section: The Macroeconomic Scenariomentioning

confidence: 99%

Assessing Long-Run Growth Prospects for the Uk’s Regions

Verikios¹,

Hurst²,

Young³

2020

NIER

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The UK faces a number of economic challenges in the short to medium term. Prior to COVID-19, renegotiation of trading arrangements with the European Union was the most prominent of these. We build on existing macroeconomic analysis by assessing prospects for the UK’s regions generated by combining a global macroeconometric model and a regional computable general equilibrium of the UK. A central macroeconomic scenario shows a national average annual GDP growth rate of 1.7 per cent to 2044. When the macroeconomic scenario is applied across regions, growth rates range from 1.6 per cent for Cambridge to 2.2 per cent for Pembrokeshire; the standard deviation is low at 0.07 per cent and the coefficient of variation is 0.04 per cent. In contrast, much wider variation is observed in the standard deviation for exports (0.36 per cent), investment (0.11 per cent) and consumption (0.14 per cent). The country results favour Scotland, which grows at an annual rate of 1.8 per cent, whereas Wales is the slowest growing of the countries at 1.7 per cent. Consistent with the macroeconomic analysis, international trade is the most important contributor to the regional variation in growth rates. We also analyse the effects of higher government consumption relative to the forecasts and find most regions are predicted to experience lower economic activity except the handful in which government consumption is a much higher share of GDP than average.

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“…In November 2018, the NIESR (Hantzsche et al, 2018) used the NiGEM macroeconomic model to evaluate the impact of Brexit. In case of a no deal exit, EU/UK trade would decrease by 56% in the medium term (half of it immediately).…”

Section: Studies On Brexit's Impacts On the Uk Economymentioning

confidence: 99%

Brexit: What economic impacts does the literature anticipate?

Mathieu¹

2020

Revue De l'OFCE

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Prospects for the UK Economy

Cited by 6 publications

References 12 publications

The economic effects of the UK government's proposed Brexit deal

The economic effects of the UK government's proposed Brexit deal

Assessing Long-Run Growth Prospects for the Uk’s Regions

Brexit: What economic impacts does the literature anticipate?

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