Does Brexit overcome the globalisation trilemma? How British business assess the trade relationship with the EU

Abstract

AbstractAccording to Rodrick, there is a globalization paradox between democracy, national sovereignty, and economic integration where only two out of these three can ever be achieved. Brexit was presented by its defenders as a way of resolving the trilemma. This contribution uses a novel survey (n = 95) to examine how UK businesses assess the new Trade and Cooperation Agreement between the UK and the EU and which model of trade they prefer moving forward. The findings by and large confirm expectations. First, the large majority considered that Brexit has had a negative impact on their businesses, including Leave voters. Second, and as regards sovereignty, the majority of Leavers thought labour shortages are a price worth paying for being able to limit freedom of movement as well as preferred to decrease EU regulations in their business sector. Third, economic integration seems to weigh heavier than concerns about sovereignty. Those who consider that Brexit had a negative financial impact on their business, including Leavers, now prefer a closer future relationship between the EU and the UK.