The costs of a border between an independent Scotland and the rest of the UK is estimated at 5.5% of Scotland’s GDP

The ‘border effect’ is the observation that trade is higher within countries than between countries. If in the long run, the border between an independent Scotland and the rest of UK affects trade like the current border between the Republic of Ireland and the UK, then the costs are estimated at 5.5% of Scotland’s GDP, finds David Comerford. However, Scotland could more than counteract that adverse effect if it achieves a level of trade with the rest of the world typical of the small countries of North West Europe.