Forum (Research Proposal Sample)

The Impact of Brexit on Income in the European Economy Author’s Name Institutional Affiliation Course Instructor’s Name Due Date The Impact of Brexit on Income in the European Economy Brexit, or Britain's exit from the European Union, is a topic that has been highly debated in the United Kingdom and beyond. The British voted to leave the EU by 52% to 48% in June 2016 (Chen et al., 2018). The British government had negotiated a withdrawal agreement with the EU that took effect on 31 January 2020. Therefore, Brexit is a popular topic of discussion in the United Kingdom. It affected all aspects of life for Brits and non-Brits, including the economy, immigration policy, and more. The Income Inequality in the European Union Following Brexit The Gini coefficient for the European Union was at 30.0% in 2020. The highest income disparities were observed in Lithuania and Bulgaria, where the former had a Gini coefficient of over 35% and the latter recorded a rate of over 38% (Eurostat, 2022). The second set of Member States with a Gini coefficient that exceeded the EU average was composed of countries such as Spain, Italy, Greece, Estonia, Latvia, Portugal, and Luxembourg. The income distribution across different regions was more evenly distributed in Slovakia, Czechia, and Slovenia (Eurostat, 2022). On the other hand, the Gini coefficient was lower in these countries at around 25.0%. Among non-member countries, such as Switzerland and Norway, coefficients above 30% were observed (Eurostat, 2022). On the other hand, Iceland and Norway had relatively low Gini coefficients. Figure 1: The Gini Coefficient for Equivalised Disposable Income per Inhabitant, 2020 (%) members (Eurostat, 2022) Causes of Income Inequality in the European Union One cause of income inequality in the EU is that some members have higher GDP than others. The most populous countries are France and Germany, both EU members (Eurostat, 2022). These countries have large populations and therefore contribute more to the GDP when compared to smaller economies like Sweden or Ireland. Ideally, the causes of income inequality in the European Union following Brexit are manifold but include the loss of jobs due to lower immigration levels, which reduced salaries and wages. Another factor is an increase in the price of goods and services imported from countries outside the EU, which will reduce purchasing power. Also another cause is the loss of EU membership, which reduced the tax revenue available to fund public services such as health care and education. Finally, another reason is reduced funding for research and development programs that could create new products and services that are more affordable than those made overseas. Figure 2: Distribution of equivalised disposable income by income quintile, 2020 (%) (Eurostat, 2022) Normative Assessment and Policy Recommendation Income inequality is a real problem affecting many European Union people. The UK was one of the EU's wealthiest countries, which has led to a wide disparity between rich and poor. As Brexit approached, many were worried that this disparity would only get worse, leading to increased poverty and other issues related to poverty. One way to mitigate this gap is through redistribution of wealth through taxation. If the government wants to reduce income inequality, it could implement a progressive tax system where those with higher salaries pay more taxes than those with lower salaries. This would help reduce income inequality because those at the top would pay more taxes than those at ...