Is brexit a transaction cost problem?

Abstract

This study analyzes the Brexit transaction cost concept. After the introduction, the transaction cost economics is explained in the first section. This section explains transaction cost progress with the contribution of Coase and Williamson. In the same section, the importance of transaction costs is also explained. This explains from which channels the transaction costs affect the economy. Williamson's Transaction Cost Economy is another subtitle in the same section. The relationship between governance and transaction costs is explained in section two. The third section explains the definition of political transaction costs, their importance and economic impacts. Brexit and political transaction costs are discussed in the last section. With Brexit, Britain is moving toward a new governance structure. The political transaction costs are expected to rise due to Britain's necessity to re-contract with the EU and other countries after Brexit. This rise in costs would impact the growth of Britain and the efficiency of the Brexit preference. © Peter Lang GmbH Internationaler Verlag der Wissenschaften Berlin 2021 All rights reserved.