Quantifying the UK’s Post-Brexit Export Potential: A Gravity Model Analysis

36 Pages Posted: 21 Dec 2017 Last revised: 22 Dec 2020

See all articles by Dan Ciuriak

Dan Ciuriak

Ciuriak Consulting Inc.; Centre for International Governance Innovation (CIGI); C.D. Howe Institute; Asia Pacific Foundation of Canada; BKP Development Research & Consulting GmbH

Fanny Siauw-Soegiarto

Carleton University, Norman Paterson School of International Affairs, Students

Sharon Zhengyang Sun

Carleton University, Norman Paterson School of International Affairs, Students

Date Written: April 22, 2017

Abstract

This study assesses the potential for enhancement post-Brexit of the UK’s non-EU trading relationships by comparing actual levels of UK exports to predicted levels based on gravity model analysis, including by taking into account factors such as similarity/dissimilarity of comparative advantage, economic freedom in partner countries, and the scope for upgrading diplomatic representation. The study finds that UK exports follow patterns consistent with the findings from the gravity model literature. Moreover, an ambitious, outward-looking export promotion policy could make up for foregone export potential to the EU under a soft exit from the Single Market in which the UK obtains a deep and comprehensive trade agreement with the EU. However, to offset the export losses are a hard exit would require raising the level of the UK’s global competitiveness based on inside the border measures to boost innovation and business development.

Keywords: UK, Brexit, gravity model, export potential

JEL Classification: F13

Suggested Citation

Ciuriak, Dan and Siauw-Soegiarto, Fanny and Sun, Sharon Zhengyang, Quantifying the UK’s Post-Brexit Export Potential: A Gravity Model Analysis (April 22, 2017). Available at SSRN: https://ssrn.com/abstract=3088624 or http://dx.doi.org/10.2139/ssrn.3088624

Dan Ciuriak (Contact Author)

Ciuriak Consulting Inc. ( email )

83 Stewart St.
Ottawa, Ontario K1N 6H9
Canada

Centre for International Governance Innovation (CIGI) ( email )

57 Erb Street West
Waterloo, Ontario N2L 6C2
Canada

C.D. Howe Institute ( email )

67 Yonge St., Suite 300
Toronto, Ontario M5E 1J8
Canada

Asia Pacific Foundation of Canada ( email )

Canada

HOME PAGE: http://ciuriakconsulting.com/

BKP Development Research & Consulting GmbH ( email )

Romanstrasse 74
München, 80639
Germany

Fanny Siauw-Soegiarto

Carleton University, Norman Paterson School of International Affairs, Students ( email )

1125 Colonel By Drive
Ottawa
Canada

Sharon Zhengyang Sun

Carleton University, Norman Paterson School of International Affairs, Students ( email )

1125 Colonel By Drive
Ottawa
Canada

HOME PAGE: http://https://carleton.ca/npsia/people/sharon-zhengyang-sun/

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