Ballots, Budgets and Bricks: Brexit and the Polarisation of Individual Economic Behaviours

Pei Kuang, Davide Luca and Zhiwu Wei

MPRA Paper from University Library of Munich, Germany

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 mostly unrelated 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: Political Polarisation; Brexit; Expectations; Spending Intentions; Housing Transactions (search for similar items in EconPapers)
JEL-codes: E00 E03 H00 H77 R31 (search for similar items in EconPapers)
Date: 2025
New Economics Papers: this item is included in nep-pol
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:125104

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