FT columnist Martin Wolf writes that, contrary to a claim of Brexit supporters, there is no reason to expect scrapping EU regulations to change the relatively poor performance of the UK economy.
The UK … has low unemployment. But it also has high inequality, mediocre real incomes, at least by the standards of its European peers, and poor external competitiveness. Above all, recent productivity growth has been truly awful.
Moreover, such failings, relative to the UK’s EU-15 peers, cannot plausibly be due to the burden of regulation since, as the OECD rightly stated in its pre-referendum report on Brexit, “regulations are low relative to those in other EU member states”. If that made the difference, the UK would be more productive and dynamic than its peers, not less so. Given this, scrapping remaining regulations would not be transformative.
What, then, might account for the poor performance of the UK economy? According to Mr Wolf,
the list includes: low investment, particularly in infrastructure; inadequate basic education of much of the population and the innumeracy of much of its elite; a grossly distorted housing market; over-centralisation of government; and a corporate sector whose leaders are motivated more by the share price than by the long-term health of the business.
Martin Wolf “Make no mistake, Britain is not a world-beating economy“, Financial Times, 30 September 2016 (metered paywall).
For details, read the full column at the link above.