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Brexit discussions have focused 90% of the energy of politicians, negotiators, and the public on 20% of GDP: goods. What about services, which account for around 80% of all economic activity in the UK? My team and I have some fact-based analysis: bit.ly/2C4dTau
We use the OECD's Services Trade Restrictiveness Index to look at policy changes that would take place under different Brexit scenarios. It's not a modeling exercise, and doesn't require a lot of theory. It is really just coding hundreds of laws and regulations. Hard facts.
What are the key results?
1. Membership of the EU Single Market confers much more favorable market access on British services exporters relative to non-EU. The tax equivalent of regulatory barriers faced by British exporters of computer services in the EU is 2%, non-EU is 33%
1. Membership of the EU Single Market confers much more favorable market access on British services exporters relative to non-EU. The tax equivalent of regulatory barriers faced by British exporters of computer services in the EU is 2%, non-EU is 33%
2. "No Deal" sees British exporters treated as third countries under the MFN principle. So they go from the low tax equivalents of regulatory barriers under the single market, to the high tax equivalents under MFN. Take insurance: currently a 3% tax equivalent. "No Deal" = 24%. 
3. CETA is not much better - we coded the whole agreement, and found that there is very little liberalization. Similar results from @uk_tpo . So under a CETA-like agreement, market access for UK exporters to the EU would be only slightly better than "no deal". CETA Insurance: 15%
4. Bottom line: only close integration with the Single Market, either a Norway-like agreement or continued membership of the Single Market, can preserve the UK's current highly preferential access to EU services markets. And this is 80% of the British economy.
5. Loss of market access means firms lose their competitive advantage, they sell less, they shrink, and ultimately they employ fewer people. Tax equivalents are not actual taxes that are paid when services cross a border, but they are the economic burden faced by exporters.
6. What about access to non-EU markets? Without a close integration agreement, it is on an MFN basis. The data show that market access to the EU is much easier than access to non-EU markets. For accounting, tax equivalent facing exporters to EU is 7%, for other markets is 31%.
7. Our report does not make any recommendations about what the UK or the EU should do going forward. It is just about facts: what we learned from applying best practice methodology to hundreds of laws and regulations. Up to civil society to decide what they want from leaders.
