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Brexit: How will UK Agriculture Fare?

Lookup NU author(s): Dr Carmen Hubbard, Emeritus Professor David Harvey, Anne Liddon, Dr Andrew Moxey, Dr Mercy Ojo, Dr George Philippidis, Charles Scott, Dr Michael Wallace

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This work is licensed under a Creative Commons Attribution 4.0 International License (CC BY 4.0).


Abstract

There is little doubt that Brexit would have significant implications for UK agriculture, a sector with strong trade links to the EU and strong reliance on CAP income support. This article reports preliminary results from employing a Computable General Equilibrium Model, a Partial Equilibrium Model and Farm Level Models to explore selected trade and domestic policy scenarios post-Brexit. These allow for the estimation of changes in producer prices, production and farm incomes against a baseline scenario of continued EU membership. Under a Free Trade Agreement with the EU, agricultural impacts are relatively modest. By contrast, unilateral removal of import tariffs has significant negative impacts on prices, production and incomes. Adoption of the EU’s WTO tariff schedule for all imports favours net importers (e.g. dairy) and harms net exporters (e.g. sheep). Given the strong dependence of most UK farms on direct payments, their removal worsens negative impacts of new trade arrangements and off-sets positive impacts. Impacts vary across different types and sizes of farm, but also regionally. However, the period of adjustment to new trade and domestic policy conditions may prove very challenging for a large number of farm businesses.


Publication metadata

Author(s): Hubbard C, Davis J, Feng S, Harvey D, Liddon A, Moxey A, Ojo M, Patton M, Philippidis G, Scott C, Shrestha S, Wallace M

Publication type: Article

Publication status: Published

Journal: EuroChoices

Year: 2018

Volume: 17

Issue: 2

Pages: 19-26

Print publication date: 01/08/2018

Online publication date: 23/08/2018

Acceptance date: 25/06/2018

Date deposited: 28/08/2018

ISSN (print): 1478-0917

ISSN (electronic): 1746-692X

Publisher: Wiley-Blackwell

URL: https://doi.org/10.1111/1746-692X.12199

DOI: 10.1111/1746-692X.12199


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