Skip to main content
Log in

Economic costs of Brexit

  • Forum Paper
  • Published:
International Economics and Economic Policy Aims and scope Submit manuscript

Abstract

Brexit has been and continues to be a huge economic burden for the UK economy and its partners. We estimate that the Eurozone as a whole missed around EUR60bn of potential outlets on the UK market since the Brexit vote. It may take a last minute decision to avoid the costs of a hard Brexit, which are significant and underestimated by many prominent proponents of Brexit. In our view, a “no deal Brexit” would trigger two consecutive years of recession in the UK and cut Eurozone growth by at least −0.5 pp. per year. A “no Brexit deal” would have strongly negative repercussions for the UK’s trading partners, especially for Germany. Exports in EUR terms fell by almost −6% in 2016–17 cumulated (or EUR5bn in value terms) and export losses should reach EUR8bn per year in a “no Brexit deal” scenario. The type of a Free Trade Agreement between the UK and the EU is most essential in the long run. We estimate UK growth to average 1.5% over the transition period, half of the 2000–07 average for example.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Chart 1
Chart 2
Chart 3

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Michael Heise.

Additional information

Publisher’s note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Heise, M., Boata, A. Economic costs of Brexit. Int Econ Econ Policy 16, 27–30 (2019). https://doi.org/10.1007/s10368-018-00428-9

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10368-018-00428-9

Navigation