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Ireland and Brexit: Modelling the impact of deal and no-deal scenarios. Quarterly Economic Commentary Special Article, Spring 2019.

Bergin, A. and Economides, P. and Garcia-Rodriguez, A. and Murphy, G. (2019) Ireland and Brexit: Modelling the impact of deal and no-deal scenarios. Quarterly Economic Commentary Special Article, Spring 2019. [Working Paper]

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    Abstract

    This Article attempts to quantify the macroeconomic impact of Brexit on the Irish economy. Given both the political and economic uncertainty, we consider a range of alternative scenarios. We focus on the most well understood channels through which Brexit will affect Ireland, namely though lower trade, incorporating the impact of tariff and non-tariff measures, and the potentially positive impact of FDI diversion to Ireland. Our approach, and the main contribution of this paper, is to build up estimates of each of these channels from a range of recent micro-economic studies, so our estimates are anchored in the empirical literature. We then use these micro-estimates to calibrate macro scenarios; specifically we generate alternative paths for the UK and international economy using the NiGEM global model and assess the impact on Ireland using the COSMO model. Overall, in each scenario, the level of Irish output is permanently below where it otherwise would have been were the UK to decide to remain in the EU.

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    Item Type: Working Paper
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > Brexit
    Countries > Ireland
    EU policies and themes > Policies & related activities > economic and financial affairs
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Economic and Social Research Institute (ESRI), Dublin > ESRI Quarterly Economic Commentary
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 11 Dec 2019 11:21
    Number of Pages: 34
    Last Modified: 11 Dec 2019 11:21
    URI: http://aei.pitt.edu/id/eprint/101836

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