UK government paper on Macroeconomic and Fiscal Performance: "A separate Scottish state would have to establish its own macroeconomic and institutional framework. Institutional and policy divergence between Scotland and the continuing UK would be likely to lead to a weakening of economic integration. And over the longer-term, some business networks might end as a result of economic, historical and cultural ties being weakened.
PRO-UNION: UK chancellor George Osborne, says:"Let's lay to rest some myths once and for all - independent countries of a similar size do not outperform Scotland."
PRO-INDEPENDENCE: Deputy Scottish First Minister Nicola Sturgeon says: "If you were sitting in Norway listening to George Osborne you would laugh at him, because they are a country of similar size to Scotland that is sitting right now on a £470bn oil fund for the future."
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David Ulph
A separate Scottish state might choose to mimic some of the institutional framework in the rest of the UK (rUK) - e.g., competition framework - or pursue a very different competition policy”
EXPERT - David Ulph, from the Social Institute for Research in Economics, says: "While it is true that a Scottish state would have to develop its own macroeconomic and institutional framework, what this statement seems to ignore is that Scotland already has a very different institutional framework from rest of UK - different legal system, education system, health system etc.
"A separate Scottish state might choose to mimic some of the institutional framework in the rest of the UK (rUK) - eg, competition framework - or pursue a very different competition policy. There is nothing inevitable about a widening divergence, this is to some extent a matter of policy choice.
"Almost by definition it is certainly true that the creation of a separate Scottish state would bring to an end the devolution of powers from UK to Scotland. But that doesn't mean that all devolution would end. There are interesting questions about devolution of powers within the rest of the UK, and devolution of tax and spending powers within Scotland to local authorities.
"While true that sharing of fiscal risks would be reduced there is nothing inevitable about not being able to coordinate policies and share costs. Note: Airbus provides example of coordination and sharing of costs across national boundaries.
"Finally, for reasons set out above, I don't think there is a lot one can learn from the literature of trade, labour and capital flows. Given the existing institutional divergences, are Scotland and the rest of the UK best thought of as two regions of a single country or as two otherwise similar regions in different countries?
"But one important point is that it is essential to distinguish trade flows from capital and labour flows. It makes a great deal of difference whether some goods or services are produced in rest of UK using capital and labour in rest of UK and then exported into Scotland, or whether there are flows of labour and capital into Scotland to facilitate local production to serve the domestic market. Institutional and other barriers may limit trade flows but encourage flows of labour and capital.