Brexit's Impact on UK Living Standards: An Economic Policy Analysis

This essay provides a comprehensive analysis of the macroeconomic effects of Brexit on the United Kingdom, focusing on its impact on the standard of living. It begins by outlining the positive and negative consequences of Brexit, including its effects on inflation, trade, and economic growth forecasts. The analysis incorporates historical data and expert opinions to evaluate the potential long-term implications of Brexit on the UK's GDP, fiscal policy, and public sector borrowings. Furthermore, the essay explores how Brexit affects various sectors, such as foreign investment, national security, and international trade relationships, ultimately influencing the employment rate and the overall well-being of UK citizens. The document also sheds light on both potential benefits, such as increased sovereignty and independent trade opportunities, and drawbacks, like reduced access to the EU market. Desklib is a platform where students can find similar solved assignments and study tools.

ESSAY

Table of Contents
INTRODUCTION...........................................................................................................................3
POSITIVE AND NEGATIVE EFFECTS OF BREXIT.................................................................3
EXPLANATION AND ANALYSIS OF BREXIT-....................................................................3
Using economic policy analysis outline and evaluate the possible positive and negative effect
of Brexit on standard of living in the UK....................................................................................7
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Macroeconomics refers to the branch of the economics which deal with the constitution,
execution, behaviour and decision making of the whole economy. The economic growth is
bifurcated into two parts it can be for the short as well as long period. With the assistance of the
macroeconomics it will easy to determine the aggregate manufacture or the productivity in the
economy. The macroeconomics includes the capital revenue, investment, different types of
expenditures and revenue generated by the specific nation. It allows the authority to determine
the growth rate of the nation in effective as well as efficient manner. Due to that it helps in
determining the circular flow of income in adequate manner. The macroeconomic of the nation is
evaluated by determining the GDP of the country. Along with that the macroeconomics can
provide the information about demand and supply in the domestic as well as international
marketplace. The principles of marketing indicate the interrelationship between the producer,
consumer, workers and the authority.
The present report is based on the macroeconomic of the United Kingdom in which it will
highlight the policies that government utilized in order to increase the values and for the welfare
of the economy of the nation. Basically the UK authority is having one of the highest economy in
the word Mainly the report reflect the positive as well as negative impact of the Brexit on the
citizens. Along with the impact on the standard of living in the UK. In context to bring the
positive impact and remove the negative one from the life style of the people. The report will
highlight the current and historical data related to the economic policy. Moreover, the report will
shade a light on different policies and their expected effect on the economy of the country. In
context to that the report will present charts and the diagrams in an appropriate manner.
POSITIVE AND NEGATIVE EFFECTS OF BREXIT
EXPLANATION AND ANALYSIS OF BREXIT-
In June 2016 UK-wide referendum was executed in which the notion won the referendum
of Brexit, after passing the resolution government of UK decided to step out from EU. At last in
2020 the Brexit was taken on the ground and UK removed itself from EU membership.
Economic policy analysis-
Brexit affected the economic policy of the nation since it was not just a political move but was
having its strong implications on the all other significant aspects like economy, diplomacy,
demography and so on.

As the referendum passed the changes in the economy started being seen. It raised the
inflation of the nation by 1.7% in 2017 which shows how intensively it was depended on EU.
Inflation in the economy costed more than 404 euros to every household of the country which is
a significant amount. It was figured out that the cost of Brexit was 2.5% of the economy of the
nation and also reduced British income by 0.6% and 1.3% (Berthou, 2020.)
The estimates which are presented by National statistics, Bank of England are more
horrific than the above data are presenting. It has said that in next 15 years UK will be suffering
a lot due to Brexit. Free trade agreement will impact -6.7% to the GDP of the nation which
would be a severe failure of the economic policy of the fifth biggest economy of the world.
(Hohlmeier and Fahrholz,2018.)
Surveys conducted in 2016 was horrific with this respect. That the GDP losses will be
ranging between 1.2-4.5% for UK. Fiscal policy of the government is made to address the perils

took place due to this action of the government but it will also impact British grasp on the market
of EU which was earlier strongly handled.
Economic growth forecasts are also not good for UK. For 2018, it was expected
somewhere between 2.4 to 1.4% which is not healthy for the nation and ultimately resulting poor
livelihood to the citizens of the nation. After referendum the top five largest banks of the nation
fell at an average 21%. With this regard for giving stability to the banks it Bank of England
released 150 billion euros (Byrne and Rice, 2018)
It will be hiking tax and other regimes for UK in EU market. The spending of EU in UK
were more than 8 billion euros in UK which was accounting big in the nation and was also
kicking off boost to the consumption level. It was about 0.4% of the national income or more
than 150 million Euros per week.
UK was one of the biggest trade partners for EU and was not only contributing bigger in
term of GDP but also helping them in meeting their many of essential requirements which would
be now not available. So it can be seen as a big change for UK since it will be loosing a good
market which will directly impact livelihood of layman in the nation. The contribution of UK in
the market of EU can be seen in the chart below- (Kordos, 2019)
(Simionescu, Streimikiene and Strielkowski, 2020)

This move is definitely helping the nation in many ways. The scenario of EU was tough
which was restricting UK to form collaborations with other parties which was hindering its way
of grabbing more market share now being self driven it may go for new market explorations too.
The capital market of EU is controlled by UK more than 78% so by forming favourable
laws UK may earn bigger profits here. Other benefits like more freedom in foreign affairs,
foreign policy making, sovereignty, security, capital market management, Trade relationship
would also be in favour of UK.
The borrowings of the government is set to be more than 50 billion euros in next couple
of years which accounts 2.% of national income. Fiscal policy which is responsible for growth
and development of the nation is also facing severe hindrances after the move since taxation,
asset management policy, capital market, capital assets all these factors are getting affected and
going in adverse direction for the government (Perry and Steenson, 2019.)
Public sector net borrowings are also not performing good which is behind higher
generation of jobs in the nation. The policy of the state is also shrinking it, earlier or before
Brexit it was more than 4% of total income but after 2016 when referendum was passed it came
down and in 2019-2020 it was negative.
Assessments for national income of UK are made by many such agencies or
organizations which are clearly supporting that it would be falling down by the year 2030 with a
heavy rate.
CEP(2016)
OECO
Oxford economics
PwC
-7.9%
-5.1%
-2.0%
-1.2%
(Hudson, Urquhart and Zhang, 2020)
Despite having differences in their opinions but this negative data are clear testimony that
it would not be in favour of the nation for at least nest decade.
UK trade value of products and EU share, 2015 (McGrattan and Waddle, 2020)

Exports (in Billions Euros) Imports (in Billions Euros)
EU
US
Rest of the world
Total
223
95
193
511
291
60
197
548
The above suggested data of the year 2015 are suggesting that EU was very prominent
partner of trade of UK since it was contributing more than 44% of the exports of the nation and
also was 53% of the imports. It shows that UK was heavily depended for its foreign trade on EU
nations. That was not only helping in more job generations for the citizens but also was giving it
a good market grasp. After Brexit there will be tougher regimes for UK to trade in EU nations
which may give surge to the cost of export and also import of essential products would not
remain that much easier. As same the trade of services with EU was also significant the imports
of services from EU was more than 50% in 2015 and exports were around 39% it depicts that
after Brexit even the services' importation in UK would also be affected and there may be new
challenges to seek new markets like USA and other Asian or African nation (Hill, 2022)
Using economic policy analysis outline and evaluate the possible positive and negative effect of
Brexit on standard of living in the UK
Defining Brexit refers to good produce in member countries that can be sold in other
countries which are part of the EU without duties and tariffs and also under member countries.
The positive impact of Brexit is related to UK reclaim its sovereignty in order to become part of
EU which require British nation to keep and giving up their authority by considering all the
issues which are related to reducing the power of UK (Bloom, Bunn and Thwaites, 2019)and
other national issues also BRICS it can be opened the door for Britain and independence
country to connect for rest of the world it also help to providing different type of household
products which are necessary for UK and their population have wide variety of choices. Also
Brexit help to immediate cause reduction for UK by influencing the nation in order to play
important role and contributing budget more than 8.5 billion Euros spent in the year where
amount need to be need to saved asset by using different purpose and benefit their inhabitants it
also help to reduce the cost of important product so that it help to increase the market Trend and
current trend (Hudson, Urquhart and Zhang, 2020). Then the economic policy of Brexit prompts

reduction in the issues due to immigration because the British nation allows citizens and the
member states to leave for the worker in the UK for the same other nation. The immigration was
increased into Britain and other nations that accept the rapid increase in the face of immigration
at perfectly.
It also helps to increase the employment rate which results for immediate reduction and the
number of immigrants that would be simultaneous increases in the number of job vacancies of a
nation (Hubbard, Davis and Shrestha, 2018.). Moreover, trade countries help to flourish the
opportunity for employment and also help to multiply even more. The economic condition of
the UK improved on the basis that teenagers get the chance to get new jobs and experienced
people had opportunities for getting employment in a better manner. Similarly it helps to
provide advantages for international trade. It is true that writing benefited on the basis of
different international deals as a member of the EU. This is also speculated that as an Indian
independence which is regarding 4 full authorities and making their own decision at that time
Brexit will prosper a lot more. Because of the entire burden that multinational governing bodies
can have on this sector people get more opportunity to expand their business to other countries
in order to gain more profit and growth (Shahzad, Lensvelt and Bhatti, 2019).
For the living society of UK get the national security by Brexit because British nation does
not abide by the rule and unrestricted flow of people in and out of the nation the moment of
people can be monitored also well reducing the chance regarding National security which can
be biggest concern due to criminal individual by youth factor then the former work and patient
secretary can Smith head expressed regarding his concern on the matter of open borders so that
it helps to we can access for terrorism to enter the nation.
However, impact of Brexit by considering economic policy are related to loss of foreign
investment in the European union and being a multinational foreign body which hold 25% share
of the global GDP also it fair share of power matters related to foreign relation and investment
in the year 2012 it has been analyze that almost half of the foreign direct investment in UK
received was associated with activities of the EU (Bashir, Ali and Abbas, 2019). It also calls the
loss for foreign direct investment on the basis of the high probability of Brexit because it affects
the international connection between countries. Then sharing of intelligence becomes difficult at
that time because the current instability of the company and the economic situation of the
company are affected because of aggression and sharing the information by intelligence is

typical but this is helpful at that time. Other hand this is also considered as divorce from the EU
which would definitely leading restrictions in the flow of confidential and other information that
are needed to access in order to create a safe environment for all the citizens of the UK because
it affects everyone in different terms. The rate of artificial intelligence increased at the time so
people got less opportunity to learn new things in the household society and shifted to other
countries but were not able to because of Brexit (Bloom, Bunn and Thwaites, 2019). Further the
shortage of high skill labor were decreases because Brexit would require all the citizen of
unction in order to return back for country and living a large number of job vacancy the living
standard of country affected because this criteria is typical to handle and often not made by
people living in UK similarly all the job vacancies and harm the potential growth of the
company. Britain leaving another EU nation must return because Brexit has stopped
immigration from the UK that put a halt and leaving more than 1.4 million and this advantage
for other countries by making questionable status for the EU. One of the safest way for return is
avoiding the conflict which will be written and written put no longer be country with diverse
international culture then rising of average household cost was text free but no longer possible
for UK and the member of countries of European that lead switching increases in the price of
various item the energy cost of the nation is expected to increase by more than 500 million
pounds preparation occur.
Addition to this it has been analyze that this is related to support for families and people
because it helps to allow new freedom for hard working people to enhance the consumer right
and protection in order to improve education for patient’s safety and healthcare. At that time of
Kuwait 19 it helped to protecting the consumer and also allow them for make their purchases by
contact free and rising contact list hundred Euros which cannot be done in the EU (Hassan,
Hollander and Tahoun, 2020). Also removing the motor insurance low to prevent increases
premium for GB motorized because government is supporting the bill that Peter bone MP is
taking through parliament and it will remove effect of European court of justice by judgment on
motor insurance in credit achieve the Government of removing the court extension of motor
insurance regarding private land greater range of vehicle that removing associate financial
liability that avoid potential increases on insurance premium. This is also considered as the life
changing experience and opportunity regarding training and education across the world by
turning scheme because international educational exchange schemes help to provide funding for

international opportunities in the training and education across the world of UK student London
and other people will get the experience for better range regarding the culture and international
institution. On the basis of economic policy the impact is related to transforming the UK
approach by clinical trials research and providing the British public with faster access to a new
innovative medical treatment in order to transforming the approach clinical trial results
improving the speed of efficiency and other clinical trials that regulate all the facilities by
providing new and innovative medical treatment which are reaching in UK public faster and
also help to ensure about the UK and its life (Shahzad, Lensvelt and Bhatti, 2019). Moreover, it
has been analyzed to improve the service people receive from the NHS because the Bill passed
before parliament for establishing the health procurement system and enabling arrangement for
all the services by reducing the bureaucracy and West and evening providing a better service in
the efficient manner. In order to take the state for strengthen the consumer; it cannot be done in
the market responding to the recommendation for advisory counseling in order to misuse the
drugs. Then amendment of law presses the control and complete complaint on the business and
enter this market which will write companies to potential harmful products that can affect the
consumer.
CONCLUSION
From the above report it will be concluded that United Kingdom is leading world sixth
largest economy in effective way. According to the canalisation the gross domestic production
of the United Kingdom is continuously changing every year. The report presented that due to
the Brexit the UK people face the various changes in the countries rules and regulation. Due to
the Brexit the country is able to export and import the goods tariff-free. Many of the people
acquire different opportunity due to the Brexit. On the other hand due to the Brexit the British
income also reduced. From the report it is analysis that the organisation is having the mixed
economy. The unemployment rate in the UK is low which increase the economy of the country
in appropriate manner. The United Kingdom is recovering from all the crises and expected to
clear in the 2023. After Brexit there will be tougher regimes for UK to trade in EU nations
which may give surge to the cost of export and also import of essential products would not
remain that much easier. As same the trade of services with EU was also significant the imports
of services from EU was more than 50% in 2015 and exports were around 39% it depicts that
after Brexit even the services' importation in UK. It also defending the UK economic interest I

creating trade remedies authorities in order to help by defending UK economic interest which is
used for investing complaint and UK industries about unfair practices in imports it has been
recommended that the imposition of new trade remedy measures regarding tariff injury also
other producer harmed by doing unfair practices that is why the government followed the
regulation by international competitiveness in the sector of financial service regarding digital
syntax green energy and other industries.

REFERENCES
Books and journals-
Bashir, U., Ali, A. and Abbas, G., 2019. Differential market reactions to pre and post Brexit
referendum. Physica A: Statistical Mechanics and its Applications, 515, pp.151-158.
Berthoud, A., 2020. Assessing the macroeconomic impact of Brexit through trade and migration
channels. Banco de Espana Ocassional Paper, (1911).
Bloom, N., Bunn, P. and Thwaites, G., 2019. The impact of Brexit on UK firms (No. w26218).
National Bureau of Economic Research.
Byrne, S. and Rice, J., 2018. Non-tariff barriers and goods trade: a Brexit impact analysis (No.
6/RT/18). Central Bank of Ireland.
Hassan, T.A., Hollander, S. and Tahoun, A., 2020. The global impact of Brexit uncertainty (No.
w26609). National Bureau of Economic Research.
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Agriculture in Post-Brexit UK (pp. 1-27). Routledge.
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Hubbard, C., Davis, J. and Shrestha, S., 2018. Brexit: How will UK agriculture
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Hudson, R., Urquhart, A. and Zhang, H., 2020. Political uncertainty and sentiment: Evidence
from the impact of Brexit on financial markets. European economic review. 129.
p.103523.
Hudson, R., Urquhart, A. and Zhang, H., 2020. Political uncertainty and sentiment: Evidence
from the impact of Brexit on financial markets. European economic review, 129,
p.103523.
Kordos, M., 2019. British-Slovak Foreign Trade Relations: Consequences of Brexit.
McGrattan, E. R. and Waddle, A., 2020. The impact of Brexit on foreign investment and
production. American Economic Journal: Macroeconomics. 12(1). pp.76-103.
Perry, K. and Steenson, M., 2019. A post-Brexit impact: A case study on the English premier
league. Harv. J. Sports & Ent. L., 10, p.1.
Shahzad, K., Lensvelt, M.A.P.E. and Bhatti, T., 2019. UK's stock market reaction to Brexit
process: A tale of two halves. Economic Modelling, 80, pp.275-283.
Simionescu, M., Streimikiene, D. and Strielkowski, W., 2020. What does Google Trends tell us
about the impact of Brexit on the unemployment rate in the UK?. Sustainability. 12(3).
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