This paper discusses the implications of Brexit for both the UK and its regions, as the latter depends on the former. We concentrate on the forecasts by Her Majesty's Treasury (HMT), the Cambridge Centre for Business Research and the Economists for Brexit. It is argued that the estimates of HMT of the loss of GDP are likely to be overstated, but, nevertheless, there will probably be a fall in output. Given this, the effect on the UK regions is analysed using the regional balance-of-payments constrained growth model. This suggests that Brexit will cause regional disparities to widen.
- Balance-of-payments constrained growth model
- Macroeconomic forecasts
- North-South divide
- UK regions