A week ago, Bruegel published this Policy Brief which I co-authored together with André Sapir and Dirk Schoenmaker. We start from the observation that Brexit will generate major structural change not only for the UK but also for the financial system of the EU27, a side that has received comparatively little media attention so far. We present a ballpark estimate of the aggregate impact in terms of relocation of business and jobs, make the analytical case for a policy response that fosters financial market integration inside the EU27, and outline three main policy recommendations: a stronger ESMA, a strengthening of banking union, and a new policy regime for financial infrastructure.
Update (February 21): a lightly revised version of the same text was published today by the Peterson Institute.
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