Modelling events: the short-term economic impact of leaving the EU

Jessica Baker, Simon Kirby, Oriol Carreras (), Jack Meaning and Rebecca Piggott ()

No 461, National Institute of Economic and Social Research (NIESR) Discussion Papers from National Institute of Economic and Social Research

Abstract: This paper presents a framework for modelling important socio-economic events in order to provide an informative counterfactual. This involves mapping the deep underlying shock associated with the event itself into a series of more tractable shocks consistent with the model being applied and calibrated from data, existing literature or ancillary analysis. The results should then be subject to testing of their sensitivity to the assumptions made. As a practical example, the paper uses the National Institute’s Global Econometric Model (NiGEM) to consider the short-term economic impact to the UK of leaving the European Union. We find that the UK economy would be around 2½ per cent smaller 2 years after a decision to leave the EU when compared to the counterfactual of deciding to remain a member.

Keywords: macroeconomic modelling; uncertainty; risk premia; investment (search for similar items in EconPapers)
JEL-codes: D80 E17 E27 E65 (search for similar items in EconPapers)
Date: 2016-06
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
https://www.niesr.ac.uk/wp-content/uploads/2021/10/dp461-4.pdf

Related works:
Journal Article: Modelling events: The short-term economic impact of leaving the EU (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nsr:niesrd:461

Access Statistics for this paper

More papers in National Institute of Economic and Social Research (NIESR) Discussion Papers from National Institute of Economic and Social Research 2 Dean Trench Street Smith Square London SW1P 3HE. Contact information at EDIRC.
Bibliographic data for series maintained by Library & Information Manager ().