Should Britain Leave the EU?

Should Britain Leave the EU?

An Economic Analysis of a Troubled Relationship, Second Edition

Patrick Minford, Sakshi Gupta, Vo P.M. Le, Vidya Mahambare and Yongdeng Xu

This second edition brings up to date a thorough review of all economic aspects of the UK's relationship with the EU, which also puts it in the political context of the upcoming referendum. It notes the intention of the EU to move to 'ever closer union' and the nature of the regulatory and general economic philosophy of the dominant countries of the EU whose writ is enforced by qualified majority voting. The book highlights the UK dilemma that, while extending free markets to its local region is attractive, this philosophy and intended union are substantially at odds with the UK's traditions of free markets and freedom under the common law. BOOK LAUNCH:

Chapter 5: Agriculture

Patrick Minford, Sakshi Gupta, Vo P.M. Le, Vidya Mahambare and Yongdeng Xu

Subjects: economics and finance, international economics, political economy, politics and public policy, european politics and policy, political economy, regulation and governance


Given the wave of liberalization and reform in the last three decades, restrictions on agricultural trade have declined from the high levels of the 1980s, even though barriers to agricultural trade remain significant in developed countries. Agriculture is protected by tariff barriers, production support and the use of export subsidies in many countries. Very few of these price distortions can be explained as being required to deal with market failures. Developed economies account for nearly 80 per cent of agricultural market distortions, as measured by world price effects. However, even among developed countries, support levels vary widely. In general – and unsurprisingly – support is smallest in countries that have efficient, export-oriented sectors (notably, Australia and New Zealand) and largest in those that are relatively inefficient and compete with imports (Japan, Korea, the EU). The EU accounts for 38 per cent of world price distortions, compared to Japan plus Korea (12 per cent), the US (16 per cent), and Canada (2 per cent). Among the numerous distortions in international agricultural trade, those imposed by the EU are the most disruptive, resulting in substantial welfare costs for the EU itself and for the world economy generally.

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