The Economics of Brexit: What Have We Learned?

A SUDDEN SHARP ECONOMIC WITHDRAWAL BY THE UK As we will show below, during the 1990s through the mid-2010s until the Brexit referendum, the UK was one of the most open large economies in the world. [...] We see the UK as fitting within two groups for comparison: the European group, which includes the European countries in the sample; and the ‘Liberal Pacific’ group, which includes the English-speaking countries in the sample plus Japan. [...] In Figure 1, we show the change in the measure of trade openness based on standard imports plus exports as a share of GDP, from the start of 2017 to the latest available data at the end of 2021. [...] In our case, we compare the UK to its large European neighbours and to the countries of the Liberal Pacific across the three categories discussed previously: trade in goods and services as a share of GDP, the growth of the migrant stock, and inward FDI as a share of GDP. [...] In Figure 7, the dark red triangle in is the current state of the UK, while the hot pink is the previous state of the UK pre-Brexit.