Reference no: EM133359471

We have arrived in 2025, and if we look back at the years of Corona, a lot has changed. While retaining much digital interaction, the social aspect of mobility locally and internationally has also returned to our lives, and with it, international mobility. Before the pandemic reached us, there was a lot of tough talk in the UK that Brexit would lead to Global Britain, whereby the country would again become the central hub of world trade, with free trade treaties, through which it will have a completely liberalized world trade. And this has indeed worked fine in the last three years since.

the end of the pandemic. However, in the next five years, this agenda will have to be implemented, leading to a sharp acceleration of trade liberalization.

Over the last seven years, we have seen many large companies headquartered in the UK move their operations within the global value chain back closer (reshoring). And that has led to a strengthening of the industrial heartland within the UK. In addition, quite a few small suppliers within the UK have become part of these value chains. In a sense, you could say that the temporary closure of the economy with high mobility costs has done the economy a lot of good, but that in the long run, the liberalization of the economy, thus returning to global free trade, also brings risks.

As a young economist working for the British Productivity Commission, you have been asked to produce a report linking the theory of international trade to the possible effects of this future liberalization of trade. The instance involves what outcomes to expect and how negative consequences can be repaired in policy terms.