Farage's argument for Remain

Nigel Farage’s demand for a second referendum if Remain wins has met with the same reaction with which the famous heckler at the Glasgow Empire greeted Mike and Bernie Winters: “Och, Christ. There’s two of ‘em.*” In fact, though, it has a serious implication – it means undecided voters should vote Remain.

The reason for this is simple. If Mr Farage gets his way then if you vote Remain and regret it, you’ll have a chance to change your decision. If, however, you vote Leave and regret it, you’ll have to live with your regret; nobody is proposing a re-match in this case.

 If you regard both possibilities as equally likely – as I guess many undecideds do – then voting Remain is obviously the thing to do. It gives you a chance to change your mind whereas voting Leave does not.

To put this another way, if you vote Remain you retain an option to leave. But if you vote Leave, you have no such option: your choice is irreversible. Common sense – and real options theory if you want to be fancy – thus says that undecideds should vote Remain. Remain plus an option to leave is, for anyone roughly undecided, a better choice that Leave with no option.

For me, this is one of the strongest arguments for Remain that I’ve heard. (It’s so powerful that it should lead to such a strong Remain vote that even Mr Farage won’t demand a re-match, but let’s leave aside this paradox.) The fact that it comes from an ardent Leaver only confirms my prior, that the Brexit debate is characterized by a lot of counter-advocacy.

* Other accounts have a more realistic description of Glaswegian argot and the Winters’ talents.

Comments

[acarraro]

While I think Brexit would be a mistake, I don't think this argument is as strong as you make it. Brexit is not permanent. I would bet the UK could join the EU again after a decade or so (maybe even less). I doubt they would even lose all the opt-outs. I mean the UK did it already, more or less. No big European country would stop the UK from joining again. You might lose the rebate for sure, but I doubt you'd have to take the Euro or Schengen.

[Dave Timoney]

Tyler Cowen made some interesting observations along the same lines today.

"Look at it this way: there is no general case for being the first rat to leave a sinking ship ... Since 'wait and see' is an option, leaving has to be much better than staying, given the mathematics of the expected value of irreversible decisions".

http://marginalrevolution.com/marginalrevolution/2016/05/is-an-imploding-eu-an-argument-for-brexit.html

[TickyW]

If Brexit happened, the UK would need to purchase a call option from the EU if the UK wished to re-join in the future. The purchase price of the call option could easily include a requirement for Britain to join the Euro.

As Chris rightly says, if the vote is to remain then the UK will retain its ability to write a put option which it can then exercise n the future should this put option go "into the money".

At the moment, economists (save for the noisy lunatics among them) agree that exercising the put option the UK currently possesses is not "in the money".

[Ralph Musgrave]

Both Chris and the BBC report he links to at the start of the above article have missed out the REASON for Farage’s 2nd vote idea, which is that the first vote has been skewed by the use of taxpayers’ money for the government’s booklet sent to every house in the country. That strikes me as a valid reason for a 2nd vote.

[Jim]

If you think the Remainers will work tirelessly to achieve Brexit in the event of a 50.5% to 49.5% Leave vote you need your head examining. They will be doing everything possible to thwart that vote, and manufacture another vote on a different package of 'reforms' as soon as possible (as in every case of an EU electorate voting against the way the EU elite wanted).

The EU does not do 'respecting the will of the people' at all.

[Deviation From The Mean]

If we demanded another vote every time institutional bias was factored in we would either have to abolish voting or abolish the institutions!

I am for the latter!

Personally though the second Scottish vote for independence can't come soon enough.

[David]

"If Mr Farage gets his way" Operative word being IF. Given Mr Farage is not even an MP, the last vote was over 40 years ago and this vote is tighter than the Remainers would like, I suspect the chances of a second referendum are rather remote. Forget options theory: it used to be called political economics for a reason.