A combination of higher taxes, lower spending and continued borrowing would allow an independent Scotland to achieve economic "equilibrium", new analysis has suggested.
The latest Scottish Trends report from economist John McLaren highlights Scotland's fiscal balance position has worsened since the referendum in 2014 due to the "virtual disappearance" of North Sea tax revenues.
Scotland is likely to be running a deficit of about £11 billion (-6.4% of GDP) by the time the UK has come close to balance in 2019-20, a difference equivalent to about £1,700 per person.
The report said: "Unlike past (relative) downturns, this differential is unlikely to change much under current tax and spend patterns as neither the Scottish nor the UK governments expect North Sea revenues to return to anything like past peaks."
While tax and spending options are available to close the gap, "none of these are easy or without consequences", it said.
The report continued: "With some combination of higher taxes, lower spending and any remaining shortfall being made up by continued borrowing, a new equilibrium position might be reached in a manageable way that does not lead to a dramatically different country.
"The political challenge that remains is for pro-independence parties to illustrate this themselves, something that, by and large, they avoided at the time of the first referendum."
The report challenges politicians to present more "realistic" outcomes to voters and admit that "difficult decisions" need to be made.
"What might emerge in a second referendum on independence is an acknowledgement that a period of adjustment would be needed, in terms of the Scottish Government's budget, involving some tough decisions on tax and spend choices.
"However, in the longer run it may be possible for a new Scotland, similar in its tax and spend structure to other existing OECD countries, to emerge.
"Overall, there might be a step change involved but not necessarily a big change in lifestyle or in Scotland's economic and fiscal structure."
The report also said the argument for joining the euro was "stronger now" than in 2014.
Prof McLaren said: "This analysis highlights the changes in economic circumstances since the first Scottish independence referendum.
"In particular, the seeming demise of the North Sea as a source of tax revenue and a Brexit vote in the UK that puts the validity of a post-independence sterling zone in doubt.
"However, the pull of these two apparent negatives to the success of a Yes vote in another referendum may not be enough to overcome the push of the UK's decision to leave the EU and the prospect of a right-of-centre UK Government for some time to come.
"Furthermore, any new offer of independence will be put to the electorate after a brief taste, sweet or bitter, of what leaving the EU might entail and this may well have a significant effect on the final outcome."
Scottish Conservative finance spokesman Murdo Fraser MSP said: "This research shows, if anything, a separate Scotland's prospects have only worsened.
"The fiscal position is less favourable, North Sea oil is in a significantly worse way and our economy lags badly behind that of the rest of the UK.
"This is exactly why people don't want independence, and why they don't want to be dragged into a divisive campaign to return that verdict again."
Scottish Labour's Westminster spokesperson Ian Murray MP said: "This report from one of Scotland's leading economists confirms that an independent Scotland would face massive public spending cuts after leaving the UK.
"Scotland is divided enough; we should not be divided again. Nicola Sturgeon should drop her plans for a divisive second independence referendum."
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