Irexit: Making the Worst of a Bad Situation

Ronald Davies and Joseph Francois

No 201812, Working Papers from School of Economics, University College Dublin

Abstract: Relative to the rest of the EU, Ireland is especially vulnerable to the fallout from Brexit, both economically and politically. With increasing frustration over the reaction from Brussels, some are suggesting that an Irish exit from the EU would benefit the nation. A key argument for this is that it would allow for reintegration with the UK, thus preserving one of its largest trading partners. Using a structural general equilibrium model, we estimate that such a move would worsen the impacts of Brexit by as much as 250%, with low-skill workers disproportionately affected. This is due to the fact that while the UK is one of Ireland's single-nation trading partners, when compared to the EU27 as a group, it is much smaller.

Keywords: Irexit; Brexit; Computable General Equilibrium (search for similar items in EconPapers)
JEL-codes: F13 F17 F53 (search for similar items in EconPapers)
Pages: 5 pages
Date: 2018-07
New Economics Papers: this item is included in nep-eec and nep-int
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http://hdl.handle.net/10197/9454 First version, 2018 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:ucn:wpaper:201812

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