Deep Integration and UK-EU Trade Relations
This paper studies the impact of deep agreements on United Kingdom-European Union trade relations. A standard gravity model is applied to assess the effect that European Union membership had on the United Kingdom's trade. The paper uses new in...
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World Bank, Washington, DC
2017
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| Online Access: | http://documents.worldbank.org/curated/en/853811484835908129/Deep-integration-and-UK-EU-trade-relations http://hdl.handle.net/10986/25956 |
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okr-10986-259562021-06-08T14:42:47Z Deep Integration and UK-EU Trade Relations Mulabdic, Alen Osnago, Alberto Ruta, Michele trade agreements trade effects regional integration trade intensity This paper studies the impact of deep agreements on United Kingdom-European Union trade relations. A standard gravity model is applied to assess the effect that European Union membership had on the United Kingdom's trade. The paper uses new information on the content of trade agreements to build a measure of "depth" based on the number of provisions the agreements cover. The analysis relies on information on goods, services, and value-added trade from the World Input Output Database. Deep trade agreements are found to increase goods and services trade by 42 percent, and value-added trade by 14 percent on average. European Union membership had a particularly strong effect on United Kingdom's services and global value chain trade. Because of its membership, the United Kingdom's services trade more than doubled, and the country's backward and forward participation in global value chains increased by more than 30 percent each. The paper uses these estimates to evaluate the future of United Kingdom-European Union trade under different scenarios. The findings show that United Kingdom-European Union trade declines under all scenarios, ranging between 6 and 28 percent for trade in value added. This drop is sharper (particularly for services and global value chain trade) the lower is the depth of the future arrangement relative to the depth of the European Union agreement. As trade flows adjust slowly to changes in trade costs, these effects are expected to emerge over time. But the trade-off between the depth of trade agreements and trade intensity will delimit policy choices going forward. 2017-01-30T19:02:14Z 2017-01-30T19:02:14Z 2017-01 Working Paper http://documents.worldbank.org/curated/en/853811484835908129/Deep-integration-and-UK-EU-trade-relations http://hdl.handle.net/10986/25956 English en_US Policy Research Working Paper;No. 7947 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper European Union United Kingdom |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
trade agreements trade effects regional integration trade intensity |
| spellingShingle |
trade agreements trade effects regional integration trade intensity Mulabdic, Alen Osnago, Alberto Ruta, Michele Deep Integration and UK-EU Trade Relations |
| geographic_facet |
European Union United Kingdom |
| relation |
Policy Research Working Paper;No. 7947 |
| description |
This paper studies the impact of deep
agreements on United Kingdom-European Union trade relations.
A standard gravity model is applied to assess the effect
that European Union membership had on the United
Kingdom's trade. The paper uses new information on the
content of trade agreements to build a measure of
"depth" based on the number of provisions the
agreements cover. The analysis relies on information on
goods, services, and value-added trade from the World Input
Output Database. Deep trade agreements are found to increase
goods and services trade by 42 percent, and value-added
trade by 14 percent on average. European Union membership
had a particularly strong effect on United Kingdom's
services and global value chain trade. Because of its
membership, the United Kingdom's services trade more
than doubled, and the country's backward and forward
participation in global value chains increased by more than
30 percent each. The paper uses these estimates to evaluate
the future of United Kingdom-European Union trade under
different scenarios. The findings show that United
Kingdom-European Union trade declines under all scenarios,
ranging between 6 and 28 percent for trade in value added.
This drop is sharper (particularly for services and global
value chain trade) the lower is the depth of the future
arrangement relative to the depth of the European Union
agreement. As trade flows adjust slowly to changes in trade
costs, these effects are expected to emerge over time. But
the trade-off between the depth of trade agreements and
trade intensity will delimit policy choices going forward. |
| format |
Working Paper |
| author |
Mulabdic, Alen Osnago, Alberto Ruta, Michele |
| author_facet |
Mulabdic, Alen Osnago, Alberto Ruta, Michele |
| author_sort |
Mulabdic, Alen |
| title |
Deep Integration and UK-EU Trade Relations |
| title_short |
Deep Integration and UK-EU Trade Relations |
| title_full |
Deep Integration and UK-EU Trade Relations |
| title_fullStr |
Deep Integration and UK-EU Trade Relations |
| title_full_unstemmed |
Deep Integration and UK-EU Trade Relations |
| title_sort |
deep integration and uk-eu trade relations |
| publisher |
World Bank, Washington, DC |
| publishDate |
2017 |
| url |
http://documents.worldbank.org/curated/en/853811484835908129/Deep-integration-and-UK-EU-trade-relations http://hdl.handle.net/10986/25956 |
| _version_ |
1764460580772511744 |