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1/ A few thoughts on what #Brexit means for our knowledge of the politics of #nationalism and #SelfDetermination (or, in nerd-speak, the comparative epistemological implications of Brexit). UK’s departure from the EU is a kind of #secession. While EU is not a sovereign state...
2/...the level of integration of EU member state economies and polities is often no less than that of federal units in sovereign federations like Canada and the US, sometimes more. I recall an EU official speaking at @munkschool a decade ago saying that EU’s market is more...
3/...integrated than Canadian one. There’s a bit of work out there on this (see snaps). Why does this matter? Because until now, we have had no advanced democracy lose a part of its territory to secession. Quebec’s 2 referendums, Catalonia’s aborted one in 2017, and Scotland’s...
4/...2014 (dare I say, Western Australia in 1933) – none have succeeded. Key element of the debate on secession in advanced democracies are the economic costs of such ‘adventures’. The mainstream argument is that secession is inevitably economically costly, even if the seceding..
5/...entity is on average wealthier than the rump political unit and the case can be made that secession means it will benefit from not having to subsidize the less developed rump state/entity (this is the key element of the Catalan case). What we have about this are...
6/...projections which are, basically, guesses. However sophisticated those projections are, the processes are just too complex. One guess was that Brexit would decimate London’s financial industry. It turns out, though it's early days, nothing... https://www.ft.com/content/0c7c2597-4afd-4ade-bc19-02c3bbc53daf
7/...of the sort happened. Our existing evidence on the economic costs of secession is sketchy. What little we do have is based on secessions in less developed countries, with less complex economies and less well developed cross-border linkages. The one study that I know is...
8/...obviously based on cases where we have not only secession, but also regime change (including economic regimes). What I can say also is that when I spoke with Milan Kucan (ex Slovene president) and a bunch of former heads of major Slovenian companies (Gorenje, Mercator...
9/...port of Koper), they all told me that Slovenia did better after independence than they thought it would. All, in other words, were fearful of the economic implications that showed themselves not to be as grave. The near-misses in Quebec/Catalonia/Scotland do not help either.
10/ On Quebec, lots has been written in the press about the negative consequence of secessionism for the province’s economy (the shift of companies from Quebec to Ontario), but I know of no study that has examined it systematically, either for the 1980 or 1995 referendum...
11/...nor do I know anyone who does know (if you do, tweet away!). On Catalonia, there was a central-government 'assisted' shift of company headquarters around October 1, 2017 to other parts of Spain (see graph), but operations do not seem to have been affected. I’m not aware...
12/...of much work that suggests anything similar re. 2014 Scottish referendum. Brexit is important because it will be the first instance of an advanced, complex economy decoupling from a larger, equally advanced, complex one. So, because we reason by analogy, whatever happens..
13/...over the next 5-10 years will feed back into any future discussion on independence, whether with the usual suspects (Scotland and Catalonia being the most obvious ones), or any unexpected future ones. Of course, first of all, it's early days so things might go south still.
14/ As relevant, the City has an outsized importance in the global financial system, so applicability of this case to others may be limited. Also, facts are not just facts – interpretations and frames matter more than the way economists or other social scientists (or people...
15/...who live the consequences) see things as developing. But I think this does not detract from the importance of Brexit for both our knowledge of secession and the analytical and, more importantly, political meaning of that knowledge. ///
