EU referendum: in or out?

Posted on the 20th June 2016 by Louis

Brexit_0

On June 23, British citizens will have the right to decide UK’s future in the European Union (EU). The current affair is similar to the 1975 referendum, when the British electorate voted to stay in the European Economic Commission (EEC). However, now the range of pending issues has expanded, including social and political aspects. Any outcome of the referendum will significantly affect Britain, highlighting both the advantages and disadvantages of its position within the EU model.

The UK’s Prime Minister, David Cameron, and the Conservative party support the “IN” campaign, arguing that it may bring better deals in the academic field, the labour market and agricultural policies. Given that between 5% and 25% of the UK’s university students come from abroad, Brexit may heavily impact the international profile of the most prestigious universities. Nowadays, EU citizens benefit from the government’s loans and the Erasmus+ program, allowing the inwards and outwards mobility of thousands of students every year. Provided the coming threat of Brexit, the increase in the tuition fees combined with bureaucratic burden of visa applications may considerably discourage EU applicants from choosing to study in the country. Consequently, the ethnic and intellectual variety of the students attending UK’s universities may diminish, ultimately impoverishing the quality of the academic research.

In addition, the negative outcome of the referendum may affect the UK’s labour market. On one hand, the protectionist border controls may decrease the number of migrant workers entering the country, therefore potentially increasing the minimum wage rate. However, given the rejection of EU working policies in regard to hiring and firing practises, the resulting unfavourable flexibility may decrease the overall working welfare outweighing the benefits of higher wage levels. On the other hand, the general level of unemployment may rise following the dismiss of three million of jobs in the country following from the reduction in international trade and policy coordination. Besides, the exclusion from the Common Agricultural Policy program may further reduce the number of small local businesses, leading to an overall decrease in agricultural trade. Therefore, the size of UK’s economic activity may significantly fall, leading to high levels of unemployment. Consequently, Brexit may jeopardize both the quantity and quality of work, potentially slowing down the country’s economic growth and lowering the average standards of living.

On the other end of the spectrum, the UKIP and part of the Conservative Party aim at UK’s independence, appealing to the issues related to the local services and security.

Supporters of this view emphasize the rule-taking position of the UK, whose national sovereignty is being jeopardized by communitarian authorities. In line with this, the opportunity cost of UK’s contribution to the EU grant is too onerous in comparison to the returns the country receives. Following this argument, they aim at the re-investment of the EU budget in the NHS and other local services, so to improve the quality of customer’s experience. Despite the immediate benefits this process may bring, the long term costs would harm the British economy. Provided more than half of the national trade volume is with the the EU, UK’s exit may ultimately reduce this source of income, generating irreversible consequences on the labour market

Securitization of the national borders from eastern migrants is another highly debated issue. The so called “refugee crisis” alarmed UK’s citizens, leading to an increased border control. Despite the validity of the argument in the international stage, the country never ratified the Schengen’s Agreement failing to abide to the European principle of complete free movement of people. According to “leave” campaign, Brexit will further increase the travelling costs through visa application processes in order to monitor more effectively the flow of migrants, ultimately reducing its volume. As a consequence, increased domestic surveillance may further increase migration costs leading to a more than proportionate reduction of high and low income migrants.

In conclusion, UK membership in the EU rises several questions about the benefits and costs the integration may bring. If it remains, Cameron will implement the deals negotiated in February with Donald Tusk, President of the European Council. If it leaves, the current Prime Minister will negotiate new bilateral agreements with the individual countries, but potentially antagonizing France and Germany’s leaders.

Written by Orsola Robasto

Sources:

https://www.cer.org.uk/sites/default/files/publications/attachments/pdf/2014/pb_britishtrade_16jan14-8285.pdf http://www.theguardian.com/news/datablog/2012/nov/22/eu-budget-spending-contributions-european-union http://www.theguardian.com/politics/2016/jun/07/eu-referendum-fact-check-david-cameron-leave-campaign-claims http://www.bbc.co.uk/news/uk-politics-32793642 http://www.theguardian.com/politics/2016/jun/03/brexit-vote-cost-uk-universities-tens-millions-student-fees-ucl http://www.bbc.co.uk/news/uk-politics-32810887

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