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Policy analysis from the Centre for Economic Performance


Comment and analyses by CEP academics concerning the referendum on Britain's membership of the European Union

Latest Posts:


 04 February 2020

The implications of Brexit for the UK economy

The United Kingdom has now formally left the European Union, but what does the future hold for the British economy? Following a recent event at LSE, Gerard Lyons, Vicky Pryce and John Van Reenen took questions from LSE staff, students and members of the public on the economic impact of Brexit.



 10 December 2019

Elections britanniques : quels enjeux pour le Brexit ? (Policy Brief)

Utilité de l'article : A l'approche des élections britanniques, l'incertitude quant à la tournure que prendra le Brexit est toujours importante. Cet article expose les scénarios possibles à ce jour ainsi que leurs conséquences sur l'avenir des relations commerciales entre le Royaume-Uni et l'Union Européenne.



 03 December 2019

Immigration is no longer the most pressing concern among the electorate

Immigration is no longer the pressing concern among the electorate that it was prior to the Brexit referendum, writes Jonathan Wadsworth (LSE). More than three years on, concerns about Europe have eclipsed anything else, including the NHS, defence, the environment and unemployment as well as immigration. However, immigration remains a highly contentious issue and its purported effects on the labour market and the wider economy are still highly contested.



 02 December 2019

Three years on: the UK is paying a high economic price for its decision to leave the EU

How has the Leave vote affected the UK economy, ask Swati Dhingra and Thomas Sampson (LSE) in this second of two blogs based on the CEP Election Analysis briefing on Brexit. It summarizes CEP research on how the referendum outcome has affected the UK economy since 2016. The first blog, which reviews work on the potential long-run economic effects of different forms of Brexit, can be found here.



 30 November 2019

Brexit will leave the UK worse off economically in all scenarios

New costs of trade will make it harder for UK firms to do business with the rest of Europe, write Swati Dhingra and Thomas Sampson.



 26 November 2019

Economic consequences of Brexit are overwhelmingly negative

The economic consequences of Brexit are overwhelmingly negative, estimate Swati Dhingra and Thomas Sampson (LSE). The more the UK distances itself from the EU’s economic institutions and policies, the greater will be the increase in trade barriers and the higher will be the costs of Brexit, they claim. This is the first of two blogs based on the CEP Election Analysis briefing on Brexit. It summarizes CEP research on the long-run economic effects of different forms of Brexit. The second blog will analyse how the referendum outcome has affected the UK economy so far.



 25 November 2019

John Van Reenen: ‘A lot of promises are just smoke and mirrors’

The British MIT-LSE economist talks about the general elections, Brexit, and what the parties are promising.



 23 November 2019

Economic insecurity breeds support for the right

UK citizens suffering an increase in insecurity have a higher probability of supporting Brexit, write Walter Bossert, Andrew E. Clark, Conchita D’Ambrosio and Anthony Lepinteur.



 16 November 2019

Eurosceptic votes are less likely when EU interventions visibly boost local job markets

Most benefits from integration occur through adjustments that are hard for people to link to the EU, write Riccardo Crescenzi, Marco Di Cataldo and Mara Giua.



 18 October 2019

Give us the right to choose

'Let us decide consciously now if we want to seriously harm ourselves, our children, and the political union of four nations', writes John Van Reenen.



 01 October 2019

New dawn fades: The post-referendum rise in import costs has hurt UK workers

By Rui Costa, Swati Dhingra and Stephen Machin

Some commentators argue that globalisation is systematically connected to the real-wage and productivity stagnation seen across the developed world. This column analyses the relationship between international trade and worker outcomes in the immediate aftermath of the Brexit referendum, when the value of the sterling fell massively against other nations’ currencies. It finds that the rise in import costs from the sterling depreciation hurt wages and training. This relative decline in real earnings of workers has reinforced pre-existing real-wage stagnation; UK workers have not fared well since the referendum price rise.



 12 September 2019

A no-deal Brexit won’t end the uncertainty for business

By Vassilis K. Fouskas and Shampa Roy-Mukherjee

It’s very difficult to say what’s going to happen with Brexit right now. The prime minister, Boris Johnson, has said he’d rather “die in a ditch” than ask for a Brexit delay. Yet that’s what MPs are pushing for him to do. And now parliament is suspended for five weeks.
For businesses, this uncertainty over the UK’s future relationship with the EU is taking its toll. But the idea that leaving without a deal on October 31 will end this uncertainty is a false one. It will just make things even more uncertain.



 26 August 2019

Why No-Deal Brexit is a battle for the soul of our nation

Britain is lurching towards an economic, political and moral disaster, writes John Van Reenen.



 03 July 2019

Mobility and the Desire for Sovereignity in Europe

By Gianmarco Ottaviano, Professor of Economics, Bocconi University. Originally published at VoxEU

Economic geography strikes back. After a couple of decades of easy talk about the ‘death of distance’ in the age of globalisation, the promise of a world of rising living standards for all is increasingly challenged by the resilience of regional disparities within countries. As long as many people and firms are not geographically mobile – and those who are tend to be the most skilled and productive – easier distant interactions can actually strengthen rather than weaken agglomeration economies. Recent electoral trends in Europe can be understood to a surprisingly large extent from this angle.



 04 June 2019

How the post-Brexit pound has hurt Britain’s workers

The unexpected result of the Brexit referendum, working through the rapid depreciation of sterling, has hurt British workers. Rui Costa, Swati Dhingra and Stephen Machin (LSE) show that the big drop in the value of the pound caused a rise in import prices, which has led to a fall in both wages and training for workers employed in the most heavily hit sectors.



 02 April 2019

Voting for Brexit has already made the UK poorer

How has voting to leave the EU affected the UK’s economy? The difficulty in answering this question is that we do not know what would have happened to the economy if Remain had won. Consequently, researchers look for ways to estimate what would have happened. For example, how would the UK’s economic output have changed since June 2016 if there had been a Remain vote? Comparing observed outcomes to what would have happened then gives an estimate of the Brexit effect. There now is evidence that voting for Brexit has already made the UK poorer, argues Thomas Sampson (LSE).



 21 March 2019

UK economy since the Brexit vote: slower GDP growth, lower productivity, and a weaker pound

Evidence of the UK’s economic performance since the EU Referendum is clear: GDP growth has slowed down, productivity has suffered, the pound has depreciated and purchasing power has gone down, and investments have declined. In this blog, Josh De Lyon and Swati Dhingra (LSE Centre for Economic Performance) argue that the impact of the Brexit vote on the health of the […]



 16 February 2019

Brexit: New UK investments in the EU are growing, while new EU investments here fall

The UK’s vote to leave the EU has generated fears that UK firms are moving investment abroad because of Brexit. For example, media reports have documented that both large UK companies such as Barclays, HSBC and EasyJet, and smaller companies such as Crust & Crumb, a Northern Irish pizza maker, have invested in the EU27 in response to Brexit. Has […]



 11 February 2019

UK firms investing billions abroad because of Brexit new CEP research finds

The UK government hopes that Brexit will make the UK a better place to do business, but new numbers from the Centre for Economic Performance (CEP) show that the opposite is happening. UK firms are voting with their money and offshoring new investments to the rest of the EU.



 11 February 2019

Voting with their money: Brexit and outward investment by UK firms

Are firms moving investment abroad because of Brexit? Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson (LSE) use a 'doppelganger method' to estimate how foreign direct investment would have evolved without the vote for Brexit.They find a 12% increase in the number of new investments made by UK firms in EU countries, and an 11% fall in new investments made by EU firms in the UK. Moreover, there is no sign of a ‘Global Britain’ effect that would have seen UK firms investing elsewhere in the world.



 06 February 2019

The challenge of dealing with 'double disruption': Brexit and technology

The UK needs a new era of policy activism with a ‘future of good work’ focus, write Christopher Pissarides, Anna Thomas and Josh De Lyon.



 08 December 2018

Resist, rebel and remain: why MPs should vote down this Brexit deal

The economics are simple. The wealthier will ride out Brexit, but the less well off will feel the pain sharply, writes John Van Reenen.



 29 November 2018

The economic cost of Brexit is unavoidable – but that doesn’t mean it’s not worth it

Economic perceptions matter. Polling expert John Curtice has shown that expectations of economic impact shape preferences around Brexit. As many as 96% of Remain voters think the UK will be worse off after Brexit, and would consequently vote Remain if given another chance. For Leave voters, 94% think the UK will be better off and would vote to leave again. So knowing what might happen matters.......We at The UK in a Changing Europe, working with the Centre for Economic Performance at the LSE and the Institute for Fiscal Studies, have reached similar findings, modelling specifically for how the prime minister’s Brexit deal would affect the UK economy.



 29 November 2018

The economic consequences of the Brexit deal: the case of trade

Both the deal on offer and trading on WTO terms would reduce UK living standards compared to staying in the EU, write Thomas Sampson and Swati Dhingra.



 24 September 2018

UK households are already suffering the consequences of the vote. The worst may be yet to come

UK households are already suffering the consequences of the vote (close to one week’s wages), and macroeconomic indicators are not looking good. It has become harder to look on the bright side of Brexit, writes Elsa Leromain (LSE). To minimise the economic costs of Brexit the UK should remain in the Single Market and the Customs Union, she argues. 



15 August 2018

A global trade war is one more reason for the UK to prioritise its future relationship with the EU

The world is amid a global trade war which currently shows no signs of dissipating. How could this global trade dispute affect Britain and the Brexit process? Josh De Lyon (LSE) argues that it is becoming increasingly clear that the UK is beginning to prioritise its future relationship with the EU, and that potential trade agreements with third countries appear to be of secondary importance.



1 August 2018

Had austerity not happened, Leave support could have been up to 10% lower

A series of cuts since the Coalition government curtailed the welfare state, activating this way a range of existing economic grievances. As a result, in districts that received the average austerity shock UKIP vote shares were up, compared to districts with little exposure to austerity. Thiemo Fetzer writes that the tight link between UKIP vote shares and an area’s support for Leave implies that, had austerity not happened, the referendum could have been in favour of Remain.



16 July 2018

The Brexit white paper: what it must address – trade, regulation and non-tariff barriers

Authors Dr Swati Dhingra and Josh De Lyon.

The government has set some clear red lines for its post-Brexit trade policy. It will not remain a member of the single market because it is not willing to accept free movement of people and does not want to be under the jurisdiction of the European Court of Justice (ECJ).



21 June 2018

Brexit is still a hot topic on Twitter, but public sentiments remain largely unchanged

The Brexit debate is intense and continues to dominate the UK policy agenda. It concerns the entire population. Josh De Lyon, Elsa Leromain and Maria Molina-Domene (LSE) use Twitter data to characterise the online discussion.



27 April 2018

Article 50 one year on: the UK economy – initial evidence

Article by Thomas Sampson.  The full economic impacts of Brexit will not materialise for many years. But 21 months after the UK voted to leave the EU, we can assess how the Brexit vote has begun to affect the British economy.



5 April 2018

Britain is already paying a price for voting to leave the EU

The full economic consequences of Brexit will not be realised for many years. But 21 months after the referendum, we can start to assess how the Brexit vote has impacted the British economy. Thomas Sampson (LSE’s CEP) summarises what we know so far.



13 March 2018

How useful are the estimates of the economic consequences of Brexit?

In this blog, Josh De Lyon (LSE’s Centre for Economic Performance) discusses some of the concerns with the economic forecasts of the effects of Brexit and suggests that the available reports are informative of the likely consequences of Brexit. He also provides an insight into how such research should be interpreted, beyond the headline-grabbing figures reported in the news.



Fri, 02 Mar 2018

Why a customs union is key for multinationals to stay in the UK

In a customs union, goods cross borders seamlessly, but in a free trade agreement, border checks are needed to ensure conformity with rules of origin, writes Paola Conconi                                              



Tue, 29 Aug 2017

What’s happened to rents in London and the UK after the Brexit referendum? Evidence from a new rental index.

Stephen Gibbons.

Everyone talks about house prices – either rising or falling – as a vital indicator of local and national economic health, and a range of indices frequently make the headlines. Rents get less robust attention, largely due to a scarcity of good timely information on the current state of the market. This is clearly a problem, since now nearly 20% of households are private renters in England, and nearly 30% in London, a figure that has nearly doubled from what it was 10 years go (Survey of English Housing).



Mon, 21 Aug 2017

Brexit and the skills challenge

Sandra McNally, CVER's Director, on skills in the UK in light of Brexit



Mon, 07 Aug 2017

Brexit and the UK's Immigration Needs

Jonathan Wadsworth

The call to action from the UK government to the Migration Advisory Committee went out last week urging the MAC to look at, among other things, the sectoral spread of EU migrants with a view to informing  the government  about "aligning the UK immigration system with a modern industrial strategy". In essence this suggests that the MAC will be asked to think about whether there are any sectors of the economy that are particularly reliant on migrant labour from the EU that might be put on some sort of expanded shortage list in the so-called "third phase" ie after or if the, as yet undefined, "transitional period" that follows Brexit in March 2019 has ended.



Thu, 27 Jul 2017

The Local Economic Impacts of Brexit

Prof. Henry G. Overman

I've been working with colleagues at the Centre for Economic Performance (Swati Dhingra and Steve Machin) and the Centre for Cities (Naomi Clayton) to take a first look at the local economic impacts of Brexit. You can read the more technical CEP piece here and the less technical CfC piece here.



Mon, 17 Apr 2017

The impact of EU development funds in poorer UK regions and the prospect of Brexit

Posted by Marco Di Cataldo, LSE 

This is an updated version, originally posted on here on EUROPP.
Brexit means that UK regions would no longer be entitled to receive EU Structural Funds. Have EU funds been effective, and what might be the consequences of an interruption of EU financial support to British regions?


Sat, 08 Oct 2016

Does immigration harm the job prospects of the UK-born? Brexit and the UK labour market

Following the referendum vote to leave the European Union, the UK faces a trade-off between retaining access to the Single Market and restricting free movement of labour. Barbara Petrongolo considers the likely impact of tougher immigration controls on the wages and employment prospects of the UK-born and the current stock of immigrants.


26 October 2016
Four principles for the UK's Brexit trade negotiations
Thomas Sampson looks at what it might mean for the UK to pursue its own trade policy for the first time since joining the EU in 1973.

15 September 2016
Economics of Brexit
John Van Reenen presented the CEP research findings of how the Brexit vote will affect both the UK and International economies to the Brookings Institute in Washington DC.

4 August 2016
Brexit and Wage Inequality
Brian Bell and Stephen Machin blog
The vote to leave outcome of the EU referendum was in part shaped by issues of labour market inequality and the decision to leave has implications for what will happen to inequality in the future. In this piece, we discuss both of these, first showing some evidence that the spatial distribution of leave votes was correlated with low and stagnating real wage levels, and second considering some key areas of relevance of the vote outcome for some aspects of wage inequality.

2 August 2016
The aftermath of the Brexit vote - the verdict from a derided expert
John Van Reenen was disappointed but not surprised by the UK's vote to Leave the EU. Whilst his own research predicts serious economic and political damage in the case of Brexit, he thought a Leave vote was a real possibility ever since David Cameron committed to a vote in 2013. In his last post as Director of LSE's Centre for Economic Performance, he gives his verdict on the campaigns, the media, politicians, and being a derided expert.

6 July 2016
Who voted Leave: the characteristics of individuals mattered, but so did those of local areas
Individual demographics had a huge effect in determining the outcome of the referendum, but the characteristics of local areas mattered as well, explain Monica Langella and Alan Manning. Immigration, the decline in manufacturing and in other sectors, as well as politics, all played an important role in deciding the outcome.

22 June 2016
CEP Analysis of Brexit: Introduction to the collected E-Book
Professor John Van Reenen draws together the strands of the 7 chapters. He concludes that Brexit will clearly damage the prosperity of all British people, poor and rich. The only uncertainty is by exactly how much”

20 June 2016
Leaving the EU would almost certainly damage our economic prospects
The economic consequences of leaving the EU have naturally been a central focus of the referendum campaign. As June 23 draws near we bring together the conclusions from our research on the likely consequences, and reflect on some of the claims made.

20 June 2016
Why Economists for Brexit and Professor Minford remain Wrong
In what must be the largest ever poll of UK based economists, for every one economist who thought Brexit would bring benefits over the next five years, there were 22 who thought it would do harm...CEP economists explain why here in full article.

11 June 2016
The Long-Term Economic Effects of Brexit
CEP’s director John Van Reenen gives his final assessment of the likely impact on the UK economy of a vote to leave the European Union.

10 June 2016
Brexit: The Impact on Trade, Investment and Immigration, CentrePiece 21 (1)

Brexit: the impact on UK trade and living standards
Foreign investors love Britain - but Brexit would end the affair
Why immigration is no reason to leave the EU

10 June 2016
Why we are better off Remaining In the European Union
Opening stratement from John Van Reenen at a Panel Discussion Chaired by Ed Conway with Andy Bagnall, Andrew Lillico and Gerald Lyons. Presented at the Annual conference of UK in a Changing Europe, June 10th 2016, QE2 Conference Centre.

2 June 2016
The ‘Britain Alone’ scenario: how Economists for Brexit defy the laws of gravity
There is a degree of consensus among economists that a Brexit will make us worse off. The exception is recent work by Economists for Brexit. Their forecast of income gains from Brexit contrasts with all other economic analysis, explain Thomas Sampson, Swati Dhingra, Gianmarco Ottaviano and John Van Reenen.

Read More […]

2 June 2016
The distributional effects of Brexit across income groups: Who bears the pain?
In recent days, pro-Brexiteers have been saying that leaving the EU may hurt the rich but it will help the poor. Although there is now a strong consensus that leaving the EU would damage the overall economy (HM Treasury, 2016; IFS, 2016; OECD, 2016; NIESR, 2016, The Guardian 28 May 2016) there has been almost no breakdown of what the effects would be on different types of people.

Read More […]

1 June 2016
Why the UK should remain in the EU: A note to friends by Professor Nicholas Barr
This note is written by Nicholas Barr for those who have asked for a reasoned view. It includes links to evidence from credible sources, none (with the essential exception of the Financial Times) behind a paywall.


31 May 2016
Brexiteers may not believe it, but our advice is strictly independent
Independent research centres are often accused by Brexiteers of bias because some of our funding is from the EU (under 5% in the case of CEP). Institute for Fiscal Studies Director explains why they are wrong (The Times Online - subscriber access only)

27 May 2016
How do ‘Economists for Brexit’ manage to defy the laws of gravity?
Their forecast of income gains from Brexit contrasts with all other economic analysis, write Thomas Sampson, Swati Dhingra, Gianmarco Ottaviano and John Van Reenen


23 May 2016
HM Treasury estimates on the impact of leaving the EU on the UK Economy
Nicholas Bloom, Professor of Economics at Stanford University and Associate of the Growth Programme at CEP in a letter commenting on the HM Treasury document.

The Treasury document takes a very reasonable approach on estimating the short-run impact on the UK economy in the event of Brexit. My own estimates contained here from a couple of weeks ago actually predict an even larger negative impact.


23 May 2016
280 economists now against Brexit as UCL and LSE sign a letter published in The Times
In a letter to The Times on the 12 May 2016, 171 academic and 25 non-academic economists said that Brexit would "entail significant long-term costs". The list of signatories has now grown to 280 names and still growing. The Economists against Brexit letter was pulled together by Tony Yates, of the University of Birmingham, Paul Levine, of the University of Surrey, and Simon Wren-Lewis, at Oxford. Professor Yates said that it had been "prompted by the tightening in the polls, and the publicity around the Economists for Britain and Economists for Brexit groups". Twenty-eight economists signed up to the two eurosceptic campaigns.

The updated list and the Times letter can be seen here.

19 May 2016
What is Brexit-related uncertainty doing to UK growth?
The LSE British Politics and Policy blog

The UK will soon vote on whether to end its 43-year membership in the European Union. Opinion polls suggest the vote is too close to call, with the ''stay'' and ''leave'' side switching leads on a regular basis, and this uncertainty is reflected in swings in the stock market, explains Nicholas Bloom. Using data from the Economic Policy Uncertainty Index, he explains why the uncertainty could be having a material negative impact on the UK's economic performance.


12 May 2016
Immigration is no reason to leave the EU
The Adam Smith Institute blog

I've become extremely pessimistic about the Leave campaign lately as it has latched on to Faragist arguments about immigration as a major reason to get out of the EU. This is not just naïve liberalism - on virtually every count, the critics of EU immigration are wrong.
A new paper from the LSE’s John Van Reenen and others summarises the existing research.


12 May 2016
EU immigration hasn't hurt jobs or wages. Here's why:
The Spectator 'Coffee House' blog

This morning’s national insurance figures have further stoked the debate about immigration, and the extent to which leaving the EU would make a difference. Many British people are concerned that high levels of immigration have hurt their jobs, wages and quality of life. However, the authors of this article - Jonathan Wadsworth, Swati Dhingra, Gianmarco Ottaviano and John Van Reenen - say the bottom line is that EU immigration has not significantly harmed the pay, jobs or public services enjoyed by Britons.

This post is based on Brexit and the Impact of Immigration on the UK, a CEP Brexit Analysis paper. It was originally published on the LSE Commentary blog.


11 May 2016
Why immigration is no reason to leave the EU
LSE Business Review blog

EU immigration hasn't impacted employment or wages for the British people, write Jonathan Wadsworth, Swati Dhingra, Gianmarco Ottaviano and John Van Reenen.


11 May 2016
Immigration from the EU is not a 'necessary evil' and does not drag down wages
LSE VoteBrexit blog

A major argument of the campaign to leave the EU is that Brexit would give the UK more control over the flow of immigrants from across Europe, who have supposedly hurt the jobs and pay of British workers. Research by Jonathan Wadsworth, Swati Dhingra, Gianmarco Ottaviano and John van Reenen shows that far from EU immigration being a 'necessary evil' to gain access to the greater trade and foreign investment that comes from being in the EU Single Market, immigration is at worst neutral and at best, an economic benefit of EU membership.


11 May 2016
EU-turn if you want to. Brexit & Immigration
The State of Working Britain blog

Immigration has for some years been the uppermost worry among the issues thought to be facing Britain in many opinion polls so it - or rather people's perceptions of its extent and its effects - is almost certainly one of the key issues that will influence the upcoming vote on whether to stay or remain in the EU. A new report from the CEP looks into this. Workers have had a rough ride in recent times. Real (inflation adjusted) wages fell by around 10% in the years after the global financial crisis of 2008 and the ensuing austerity. Such a sustained fall in pay is unprecedented in British post-war history.


15 April 2016
How Brexit will reduce foreign investment in the UK.... and why it matters
LSE Business Review

Leaving the EU could lead to a fall in inward foreign direct investment of close to a quarter, writes a CEP team.


15 April 2016
How Brexit would reduce foreign investment in the UK - and why that matters
The Conversation

Foreign investors love Britain, but Brexit would kill the vibe. According to new research conducted at the Centre for Economic Performance, leaving the European Union could lead to a fall in inward foreign direct investment into the UK of close to a quarter. This would damage productivity and could lower people's real incomes by more than 3%.


04 April 2016
The consequences of Brexit for UK trade and living standards
VOX - CEPR's Policy Portal

The economic consequences of leaving the EU are at the heart of the Brexit debate. This column studies how changes in trade and fiscal transfers to the EU following Brexit would affect living standards in the UK. Across a range of scenarios, Brexit leads to lower income per capita, but the magnitude of the loss depends on what trade policies the UK adopts post-Brexit. To minimise the economic costs of Brexit, the UK would have to remain closely integrated into the Single Market.


21 March 2016
The question is not whether Brexit will cost the UK in economic terms but how much
LSE British Politics and Policy blog

For over two years, a research team at the Centre for Economic Performance (CEP) has been studying the likely impact of the UK leaving the European Union. Their latest report focuses on the impact of 'Brexit' through changing trade patterns. Under 'optimistic' assumptions, there is a fall in national income of 1.3 per cent (about £850 per household). Under 'pessimistic' assumptions, this doubles to 2.6 per cent. When the dynamic effects of higher trade costs on productivity are included, the cost may rise to between 6.3 per cent and 9.5 per cent in the long run.