Pro-Brexit Economists Make Their Case
As Britons prepare to vote on whether the U.K. should remain in the European Union or split off, perhaps the most commonly cited argument for staying in has been an economic appeal. Such a move, critics say, would gravely jeopardize the British economy.
On Thursday, however, a group of eight notable economists aligned with the campaign to toss out Britain’s EU membership tried to change that impression. In an announcement, the group presented arguments that the split would grow the economy by 4 percent, compared to the alternative of staying in the EU.
By abandoning the EU’s external tariffs and using instead the tariff levels offered by the World Trade Organization, the U.K. could see consumer prices fall by 8 percent, Patrick Minford, professor of economics at Cardiff University, said.
Trade arguments have typically been a central concern of economists who oppose a so-called Brexit. Leaving the union would force Britain to sign more than a hundred new trade agreements with countries around the world, they say, a point underscored by U.S. President Barack Obama’s recent warning that the U.K. would fall to the back of the line in trade talks if it left the EU.
But Minford waved such arguments off. “There is no need for us to go off chasing a million trade deals with the rest of the world,” Minford said. “They are irrelevant.”
That opinion — and the broader argument that the British economy would benefit from a Brexit — flies in the face of what the broader economic community has said for the past several months. In a Reuters poll conducted earlier this month, an overwhelming majority of economists said a vote to leave the EU would damage the British economy.
“Both the U.K. and Europe risk a fall into recession in the following quarters due to the increased uncertainty,” Danske Bank economist Mikel Milhoj told Reuters. “One has to take into account that the U.K. is the second largest economy in the EU so this is a big deal.”
A popular referendum on the proposed Brexit is scheduled for June 23.