Ballots, budgets and bricks: Brexit and the polarisation of individual economic behaviours

Pei Kuang, Davide Luca and Zhiwu Wei

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Does political polarisation influence actual economic behaviours? Using British nationally representative surveys and administrative data, we document how the Brexit referendum triggered stark divergences in individual micro and macro expectations between Leave and Remain supporters. Compared to existing research, we show how these polarising effects were driven by a specific policy issue and only marginally related to traditional partisan identities. We also demonstrate how these diverging beliefs influenced major real financial decisions. Leavers became more likely to purchase durable goods and engage in housing transactions, and areas with higher proportions of Leave voters experienced increased housing transaction volumes and rising prices.

Keywords: Brexit; expectations; housing transactions; political polarisation; spending intentions (search for similar items in EconPapers)
JEL-codes: D84 E66 P16 R21 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2026-07-31
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Published in Journal of Public Economics, 31, July, 2026, 259. ISSN: 0047-2727

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