Photo: “We voted leave“, by Mark Ramsay licensed under CC BY 2.0. Hue modified from the original
Fetzer, Thiemo. “Did austerity cause Brexit?.” American Economic Review 109, no. 11 (2019): 3849-86.
Abstract
This paper documents a significant association between the exposure of an individual or area to the UK government’s austerity-induced welfare reforms begun in 2010, and the following: the subsequent rise in support for the UK Independence Party, an important correlate of Leave support in the 2016 UK referendum on European Union membership; broader individual-level measures of political dissatisfaction; and direct measures of support for Leave. Leveraging data from all UK electoral contests since 2000, along with detailed, individual-level panel data, the findings suggest that the EU referendum could have resulted in a Remain victory had it not been for austerity.
