Open AccessThe United Kingdom and Brexit: Implications, Consequences and Opportunities
Author(s) -
Ilhamah Qiamy,
Fahim Nawaz,
Syed Umair Jalal
Publication year - 2018
Publication title -
global economics review
Language(s) - English
Resource type - Journals
eISSN - 2707-0093
pISSN - 2521-2974
DOI - 10.31703/ger.2018(iii-ii).01
Subject(s) - brexit , economics , gross domestic product , international trade , shock (circulatory) , european union , international economics , investment (military) , foreign direct investment , politics , political science , economy , macroeconomics , medicine , law
Presently, Brexit and its implications for the United Kingdom (UK), European Union and rest of the world, are regarded as major concerns across the globe. The present study is an attempt to estimate the shock that the UKs economy will likely receive as a consequence of Brexit. It also seeks to find an answer to the question whether costs incurred as a consequence of Brexit are repairable or otherwise for the UK. By applying a vector autoregressive (VAR) model on annual time series data of four important economic variables, i.e. gross domestic product (GDP), imports, exports and foreign direct investment, ranging from 1970-2016, an interdependence relation was found to hold among variables. The result concludes that through Brexit, the UKs economy will face some fluctuations which wont last any longer than 12 to 15 years. In return, it will grant UK sovereignty in the different vital segments of the country like economic policies and political decisions.