Dynamics of economic unions: An agent-based model to investigate the economic and social drivers of withdrawals

Economic unions are international agreements oriented to increase economic efficiency and establishing political cultural ties between the member countries. Becoming a of an existing union usually requires approval both candidate members, while leaving it may require only unilateral will exiting country. There many examples accession states previously consolidated unions, recent example is withdrawal United Kingdom from European Union. Motivated by Brexit process, in this paper we propose agent-based model study determinant factors driving withdrawals union. We show that Union local taxes promote exits, whereas customs fees out boost cohesion. Furthermore, heterogeneity business conditions wealth distribution promotes withdrawals, countries' size diversity does not have significant effect on them. also deep into individual causes lead dissatisfaction and, ultimately, exits. found that, for low taxes, inequality within country leading cause anti-Union opinion spreading. Conversely, high country's performance turns be main force, resulting risk wealthier countries These findings helpful design policies effective informative campaigns.