Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282430 
Year of Publication: 
2023
Series/Report no.: 
CESifo Working Paper No. 10742
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We quantify the economic impact of a potential secession of Catalonia from Spain. Using a novel dataset of trade flows between 17 Spanish sub-national regions and 142 countries, we estimate effects of different levels of borders on trade flows and uncover heterogeneity in country-to-country, region-to-country, region-to-region, as well as EU border effects. We use a general equilibrium analysis to understand the consequences of a potential Catalan secession, considering the associated political uncertainty. In counterfactual experiments, we impose new borders on Catalan trade, potentially within or outside the EU, resulting in a welfare decline for Catalonia and the remaining Spanish regions.
Subjects: 
international trade
regional trade
border effects
regional independence
JEL: 
F10
F13
F14
H77
R12
Document Type: 
Working Paper
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