Brexit shock

©Adrian Dennis/AFP

If a British referendum on European Union membership scheduled for 23 June led the UK to leave the EU, there would be a severe negative shock to the economy, causing growth to weaken for many years,  an OECD study argues.

OECD Secretary-General Angel Gurría put it bluntly in a speech to the London School of Economics on Wednesday 27 April:  quitting the EU would be a pure deadweight loss, with no economic benefit, but rather imposing a Brexit tax on generations to come. You can hear the podcast here. Indeed, while EU membership has contributed to British prosperity, current uncertainty about the outcome of the referendum has already started to undermine UK growth, writes Rafal Kierzenkowski, on the OECD Economics Department’s blog.

Kierzenkowski, Rafal (2016), "The economic consequences of Brexit: A taxing decision", http://oecdecoscope.wordpress.com, April

Kierzenkowski, Rafal, Nigel Pain, Elena Rusticelli and Sanne Zwart (2016), The Economic Consequences of Brexit: A Taxing Decision, OECD Economic Policy Paper, No 16, April

The economic consequences of Brexit: A taxing decision

Emmerson, Carl, Paul Johnson, Ian Mitchell and David Phillips (2016), "Brexit and the UK's public finances", IFS Report 116, Institute for Fiscal Studies

©OECD Observer April 2016




Economic data

GDP: +0.43% Q1 2017
Employment rate: 67.2% Q4 2016
Annual inflation: 2.4% Apr 2017
Trade: +3.0% exp, +4.0% imp, Q1 2017
Unemployment: 6.008% Mar 2017
LOOKING AHEAD: The outlook, to judge by factory order books, building permits, long-term interest rates and other "leading" indicators that point to future activity remains modest at best. Click curve to find out more country trends.
Updated: 14 June 2017

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