The Economic Impact of Brexit
This paper examines the impact of the UK's decision to leave the European Union (Brexit) in 2016. Using a decade of data since the referendum, we combine estimates using macro data with estimates using micro data collected through our Decision Maker Panel survey. These suggest that by the end of 2025 Brexit had reduced UK GDP by 6% to 8%, with the impact accumulating steadily over time. We estimate that investment was reduced by 12% to 13%, employment by 3% to 4% and productivity by 3% to 4%. These negative impacts reflect a combination of elevated uncertainty, reduced demand, diverted management time, and increased misallocation of resources from a protracted Brexit process. Comparing these with contemporary forecasts shows that these forecasts were relatively accurate in the short to medium term, but they underestimated the impact over a decade.
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Copy CitationNicholas Bloom, Philip Bunn, Paul Mizen, Pawel Smietanka, and Gregory Thwaites, "The Economic Impact of Brexit," NBER Working Paper 34459 (2025), https://doi.org/10.3386/w34459.Download Citation
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Non-Technical Summaries
- Nearly a decade has passed since British voters narrowly chose to leave the European Union in June 2016. The referendum's outcome set in...
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