Policy Research in Macroeconomics

UK – bottom of the international economic league table

Image by Maarten van Maanen from Eindhoven, Netherlands, https://commons.wikimedia.org/wiki/File:Desert_walk_%285130198174%29.jpg

There are still a lot of arguments on Twitter as to whether the UK is doing ‘better’ or ‘worse’ in terms of GDP than, in particular, our EU neighbours, and the G7 in general.  (Yes we know GDP is a wholly inadequate measure, but it’s still the common currency in our political debate, and we don’t want to leave the field to the false claims of others).

Today, dear old Liam Halligan, now to be found wandering the arid deserts of GB News and the Daily Torygraph, has valiantly tried to lift Brexiter morale with a statistically misleading tweet and chart:

Many are those who replied to Liam pointing out that the UK’s ‘chalked up’ performance in 2022 was wholly due to having fallen further GDP-wise than other countries in 2020 – something that Halligan knew very well already. Though let’s add this – when projected annual ‘growth’ of 0.2% is seen as great news to tweet about, well, things are certainly looking bad in the Brexit breadbin.

There are also those, however, on the anti-Brexit wing who seem to go higher than the hard evidence supports, in their estimations of the economic damage thus far done to the UK by Brexit. For example, there are the (to my mind unconvincing) doppelgänger-advocates, such as John Springford of the Centre for European Reform. Last December, Springford claimed that a modelled counterfactual UK that did not leave the EU (based on a ‘basket’ of countries similar to the UK in economic performance before the Referendum) would have had a 5.5% higher level of GDP by the end of the 2nd Quarter (Q2) of 2022. 

For my part, I prefer as evidence to compare the UK with the actual figures for other major advanced economies and groupings (‘entities’ in the table below), from which readers may draw their own conclusion of the performance of the UK economy compared to other major ‘advanced economies’.  I have taken the period Q4 of 2019, when the UK and most other economies were at their pre-Covid peak, and calculated the change in GDP against the most recent figures for Q4 2022.  All data is from the OECD’s “Volume and price indices – GDP expenditure approach” database, which uses 2015 as the base year.

The same data, in bar chart format, to compare and contrast with Mr Halligan’s chart:

For sad Brexiteers, looking for comfort amid the statistical desert, as a hart longs for cooling streams, I can offer one micro-comfort.  The Czech Republic (not a member of the Euro Area) is the one EU country that has fared even worse than the UK, with Q4 GDP 1% lower than in Q4 of 2019.

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