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A hitch-hiker’s guide to post-Brexit trade negotiations: options and principles

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  • Dhingra, Swati
  • Ottaviano, Gianmarco
  • Sampson, Thomas

Abstract

Brexit will require the UK to negotiate new trade arrangements with the EU. After summarizing the main options for future UK–EU trade relations, this article reviews the purpose of trade agreements. We highlight that trade negotiations are a bargaining game between countries seeking to reap the gains from international coordination while conceding as little as possible to their negotiating partners. This leads us to propose four principles the UK should adopt to guide its trade negotiating strategy: (i) you get what you give; (ii) where negotiations start from matters; (iii) bargain from a position of power; and (iv) invest in negotiating capacity.

Suggested Citation

  • Dhingra, Swati & Ottaviano, Gianmarco & Sampson, Thomas, 2017. "A hitch-hiker’s guide to post-Brexit trade negotiations: options and principles," LSE Research Online Documents on Economics 83665, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:83665
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    File URL: http://eprints.lse.ac.uk/83665/
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    References listed on IDEAS

    as
    1. Dhingra, Swati & Ottaviano, Gianmarco I. P. & Sampson, Thomas & Reenen, John Van, 2016. "The consequences of Brexit for UK trade and living standards," LSE Research Online Documents on Economics 66144, London School of Economics and Political Science, LSE Library.
    2. Kyle Bagwell & Robert W. Staiger, 2001. "Domestic Policies, National Sovereignty, and International Economic Institutions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 519-562.
    3. Thomas Sampson, 2016. "Four principles for the UK's Brexit trade negotiations," CentrePiece - The magazine for economic performance 489, Centre for Economic Performance, LSE.
    4. Gene M. Grossman, 2016. "The Purpose of Trade Agreements," NBER Working Papers 22070, National Bureau of Economic Research, Inc.
    5. Swati Dhingra & Thomas Sampson, 2016. "Life after Brexit : What are the UK’s options outside the European Union?," CEP Brexit Analysis Papers 01, Centre for Economic Performance, LSE.
    6. Swati Dhingra & Gianmarco Ottaviano & Thomas Sampson & John Van Reenen, 2016. "The impact of Brexit on foreign investment in the UK," CEP Brexit Analysis Papers 03, Centre for Economic Performance, LSE.
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    Cited by:

    1. Swati Dhingra & Gianmarco Ottaviano & Veronica Rappoport & Thomas Sampson & Catherine Thomas, 2018. "UK trade and FDI: A post‐Brexit perspective," Papers in Regional Science, Wiley Blackwell, vol. 97(1), pages 9-24, March.
    2. Philip Mayer & Christopher Stephen Ball & Stefan Vögele & Wilhelm Kuckshinrichs & Dirk Rübbelke, 2019. "Analyzing Brexit: Implications for the Electricity System of Great Britain," Energies, MDPI, vol. 12(17), pages 1-27, August.

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    More about this item

    Keywords

    Brexit; trade negotiations;

    JEL classification:

    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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