The Dish blog has a helpful roundup of commentary on the debate over the potential effects of Scottish secession. A key question is whether an independent Scotland will be able to pursue more left-wing economic policies than the present United Kingdom, as Scottish nationalists hope, or whether it will instead have to move in the opposite direction due to the loss of UK subsidies and tax and regulatory competition from England. University of Chicago Law Professor Eric Posner and some other commentators seem to expect that Scotland would be able to build a bigger welfare state than it currently has. As Posner puts it, “[t]he Scots would be able to govern themselves however they want—and that includes putting into place the more generous welfare state that the more right-leaning English public has denied them.”

I am not so sure. An independent Scotland could instead end up following the lead of Slovakia, which broke away from the Czech Republic in large part because the Slovaks preferred a more interventionist economic policy. But, in reality, the loss of Czech subsidies led independent Slovakia to adopt more free market policies than it had before, which were a major cause of the country’s economic success over the last twenty years. If an independent Scotland moves in the same direction as Slovakia did, I – as a libertarian – very much welcome the prospect (especially since it would also probably result in more free market policies in the remaining UK, which would be left with a less left-wing electorate). But I recognize that this is by no means the only plausible scenario that might emerge as a result of Scottish secession.

Whether independent Scotland ends up with a larger welfare state than it has now or a smaller one depends in large part on whether the Scots will be able to finance higher government spending with North Sea oil revenue. Oil production in that region has declined 40% over the last four years, so this may well be a wasting asset. Its future prospects are unclear. It is also far from certain whether the British government will simply let Scotland keep all of the oil, as opposed to insisting on a division proportional to Scotland’s percentage of the UK population.

Scotland’s future economic policies and prospects may also be heavily affected by the reactions of the rump UK and the European Union to independence. If the EU refuses to grant Scotland automatic admission, or if the UK refuses to allow free trade and freedom of movement between the two countries, Scotland could be seriously harmed. I think these dangerous scenarios are relatively unlikely, but perhaps they cannot be discounted completely.

These calculations may become moot if the “no” side wins the Scottish referendum after all, as some new polls suggest. But even if Scotland remains part of the UK, it may well end up with much greater autonomy than it enjoys currently. In an effort to persuade Scots to stay in the Union, all of the major British political parties (Labor, Liberal Democrats, and Conservatives) have floated “devo max” proposals that would give the Scottish parliament much greater control over economic and social policy. Some increased devolution is likely to happen in the event of a “no” vote. If some version of “devo max” does get implemented, it might raise some of the same issues as independence would. For example, the rest of the UK might not be willing to subsidize Scotland as much as it does currently, if the Scots are pursuing their own separate policies on major issues.

Regardless of the outcome of next week’s vote, the UK may never return to the pre-referendum status quo. At this point, all we can say for sure is that it will be an interesting case study for students of federalism and secession.