Is EU Membership Important for the UK’s Aerospace Industry?

Jackson, Alex (2014) Is EU Membership Important for the UK’s Aerospace Industry? [Dissertation (University of Nottingham only)] (Unpublished)

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At the time of writing the UK is faced with two of the largest challenges to its international status in a generation, these issues are: The Scottish referendum in September 2014 and the current government’s scheduled referendum on European Union membership in 2017. This investigation explores the latter of these two issues. It is likely that the UK electorate in an EU referendum will be influenced by economic criteria (Portes, 2013). Studies thus far have largely focussed on the macroeconomic impacts of EU membership using econometric gravity modelling techniques and have identified difficulties in accurately modelling the impact of UK EU membership (Pain & Young, 2004, Springford & Tilford, 2013). Consequently business perceptions of EU membership are also being obtained.

Pan-industry studies have thus far been conducted by the DNCC (2013) and CBI (2013). Within these studies parameters of: industry, firm size and firm origin were left largely unexplored and are considered important within this investigation. Firm origin has implications for FDI motives (Dunning, 2000), whilst firm size is important since larger firms may be more dependent on non UK based revenue (ECORYS, 2009) thereby leading these firms to be more exposed to any changes in the UK’s EU relationship.

This investigation explores the impact of the EU on the aerospace industry with this industry selected due to both its position as a key strategic industry (BIS, 2012) and since it has been hypothesised to be highly affected by an EU withdrawal (Portes, 2013). Findings from this investigation highlight that of 61 firms surveyed, 67% of believe an EU withdrawal would have a negative impact on their business with only 5% desiring an EU withdrawal to either a customs union or free trade area. Overwhelmingly firms desired to maintain the current situation or renegotiate the current situation (41% and 36% of firms respectively) with these findings supporting other studies conducted thus far. Continued EU membership is important for a number of reasons including: market access, funding, access to highly skilled labour and business stability.

These findings will be important for both government & electorate alike since they will enable a greater understanding of the rationale for EU membership as assessed through the lens of one of Britain’s most important growth industries.

Item Type: Dissertation (University of Nottingham only)
Depositing User: EP, Services
Date Deposited: 11 Nov 2014 15:14
Last Modified: 24 Oct 2016 05:03

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