The Impact of Brexit on the Foreign Direct Investment in the UK

Inhaltsverzeichnis (Table of Contents)

• Introduction
• Summary of the working paper “The influence of Brexit on the Foreign Direct Investment Projects and Inflows to the United Kingdom” by Mihaela Simionescu
  • Introduction
  • Literature Review
  • Methodology
    • Gravity approach based on Mixed-effects poisson regression models
    • Differences-in-differences approach
  • Variables and Data
  • Results
  • Conclusion
  • Discussion
• Summary of the paper “Brexit and foreign investment in the UK” by Nigel Driffield and Michail Karoglou
  • Introduction
  • Overview of the foreign direct investment time series literature
  • Importance of Brexit for foreign direct investment
  • The model
  • Data and econometric methodology
  • Results
  • Conclusions of the paper
  • Discussion
• Conclusion
• Literature

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

The main purpose of this Bachelor's thesis is to analyze the impact of Brexit on foreign direct investment (FDI) in the UK and its implications for the job market. The thesis utilizes two working papers as the primary sources for its analysis: “The Influence of Brexit on the Foreign Direct Investment Projects and Inflows in the United Kingdom” by Mihaela Simionescu, and "Brexit and foreign investment in the UK" by Nigel Driffield and Michail Karoglou.

• The impact of Brexit on FDI projects and inflows in the UK.
• The relationship between Brexit and job creation in the UK.
• The methodology and models used to analyze the impact of Brexit on FDI.
• The potential consequences of Brexit for the UK economy, particularly the financial sector.
• The role of the UK government in mitigating the negative effects of Brexit on FDI.

Zusammenfassung der Kapitel (Chapter Summaries)

The first part of the thesis summarizes Mihaela Simionescu's working paper, which examines the impact of Brexit on FDI in the UK using two proxy variables: FDI projects and FDI inflows as a percentage of GDP. Simionescu utilizes the gravity model and a differences-in-differences approach to analyze the data. The author concludes that the number of FDI projects could decrease by 65% to 90% after Brexit and suggests that the UK should consider following a cooperative model similar to Norway's relationship with the EU to mitigate the negative effects.

The second part of the thesis summarizes Nigel Driffield and Michail Karoglou's paper, which focuses on the impact of Brexit on FDI in the UK. The authors provide an overview of the FDI time series literature and discuss the importance of Brexit for FDI. They develop a model to analyze the impact of Brexit on FDI and present their findings based on data and econometric methodology. The paper concludes that Brexit is likely to have a negative impact on FDI in the UK.

Schlüsselwörter (Keywords)

The core concepts explored in this thesis include Brexit, foreign direct investment (FDI), the UK economy, job market, gravity model, differences-in-differences approach, trade barriers, supply chain management, and the financial sector. The thesis also examines the role of the UK government in mitigating the negative effects of Brexit on FDI.