Thread by @SamuelMarcLowe

Behind most Brexit claims lies an economic model, and a set of assumptions.

So when @Jacob_Rees_Mogg says that Brexit will reduce the cost of food, wine and clothes “by 20 per cent”, whose model, and assumptions, is he relying on?

express.co.uk/news/politics/…

The answer: Patrick Minford of Patrick Minford fame. He argues that post-Brexit, if the UK unilaterally drops all tariffs to zero, food prices would fall by about 20 per cent.

iea.org.uk/wp-content/upl…

In order to produce this figure, Minford makes the following assumptions:

That following Brexit:

-We will buy any given product at the lowest price available globally
-That distance does not have any impact on price
-That quality and safety does not have any impact on price

-That consumers instantly substitute any given type of product for a cheaper one, given the opportunity
-That advertising and branding doesn’t exist, and has no impact on the price people are willing to pay

In essence Minford is "attributing all the differences in producer prices between the EU and low-cost countries to EU trade barriers, ignoring the obvious differences in safety, quality, product mix etc”

blogs.sussex.ac.uk/uktpo/2017/04/…

In English:

That once we Brexit and unilaterally drop tariffs to zero, instead of buying Champagne, UK consumers will buy the cheapest Chinese knockoff at Xinjiang prices.

Most everyone relies on models and assumptions, even @Jacob_Rees_Mogg. Some models and assumptions are more reasonable than others.