Turning on the Light: Assessing the Impact of Brexit Using Electricity Demand as a Proxy

Abstract

In this short paper we are developing an empirical model that allows us to assess the economic impact of Brexit nearly in real-time. For this we use the electricity demand in England and Wales as a proxy of economic activity. We control for a large variety of external influencing factors like varies weather indicators, calendar and time variables, as well as public holidays and other events (e.g. Olympics). The resulting residuals allow us to make inferences on the economic, and here in particular manufacturing activity, in the country.

Keywords: Brexit, Energy Demand, Economic Activity

JEL Classification: E27, E37, E65