Inflation Threshold Levels and Economic Growth in the Franc Zone Countries

This paper examines the growth-inflation nexus in Franc zone currency unions. It aims at estimating the inflation threshold above which additional inflationary pressures adversely affect economic expansion. It uses cointegration methods that are ap...

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Main Authors: Sanga, Dimitri, Gui-Diby, Steve Loris
Format: Working Paper
Language:English
Published: World Bank, Washington, DC 2020
Subjects:
Online Access:http://documents.worldbank.org/curated/en/956741600700107596/Inflation-Threshold-Levels-and-Economic-Growth-in-the-Franc-Zone-Countries
http://hdl.handle.net/10986/34503
id okr-10986-34503
recordtype oai_dc
spelling okr-10986-345032022-09-20T00:10:56Z Inflation Threshold Levels and Economic Growth in the Franc Zone Countries Sanga, Dimitri Gui-Diby, Steve Loris INFLATION ECONOMIC GROWTH FRANC ZONE WAEMU CEMAC COINTEGRATION FIXED EXCHANGE RATE REGIME CURRENCY UNION CENTRAL AFRICAN MONETARY UNION WEST AFRICAN ECONOMIC AND MONETARY UNION This paper examines the growth-inflation nexus in Franc zone currency unions. It aims at estimating the inflation threshold above which additional inflationary pressures adversely affect economic expansion. It uses cointegration methods that are applied to data from 14 African countries from the Franc zone over 1970-2018. Based on country-level data, the results indicate that it is possible to increase the threshold levels used by regional central banks to 5.4-5.6 percent in the Central African Monetary Union and 4.3-4.5 percent in the West African Monetary Union. Homogeneous cointegration panel data analyses confirm the need to increase the threshold in Central African Monetary Union countries but do not in the West African Monetary Union countries. 2020-09-24T18:44:56Z 2020-09-24T18:44:56Z 2020-09 Working Paper http://documents.worldbank.org/curated/en/956741600700107596/Inflation-Threshold-Levels-and-Economic-Growth-in-the-Franc-Zone-Countries http://hdl.handle.net/10986/34503 English Policy Research Working Paper;No. 9405 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa Central Africa West Africa
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic INFLATION
ECONOMIC GROWTH
FRANC ZONE
WAEMU
CEMAC
COINTEGRATION
FIXED EXCHANGE RATE REGIME
CURRENCY UNION
CENTRAL AFRICAN MONETARY UNION
WEST AFRICAN ECONOMIC AND MONETARY UNION
spellingShingle INFLATION
ECONOMIC GROWTH
FRANC ZONE
WAEMU
CEMAC
COINTEGRATION
FIXED EXCHANGE RATE REGIME
CURRENCY UNION
CENTRAL AFRICAN MONETARY UNION
WEST AFRICAN ECONOMIC AND MONETARY UNION
Sanga, Dimitri
Gui-Diby, Steve Loris
Inflation Threshold Levels and Economic Growth in the Franc Zone Countries
geographic_facet Africa
Central Africa
West Africa
relation Policy Research Working Paper;No. 9405
description This paper examines the growth-inflation nexus in Franc zone currency unions. It aims at estimating the inflation threshold above which additional inflationary pressures adversely affect economic expansion. It uses cointegration methods that are applied to data from 14 African countries from the Franc zone over 1970-2018. Based on country-level data, the results indicate that it is possible to increase the threshold levels used by regional central banks to 5.4-5.6 percent in the Central African Monetary Union and 4.3-4.5 percent in the West African Monetary Union. Homogeneous cointegration panel data analyses confirm the need to increase the threshold in Central African Monetary Union countries but do not in the West African Monetary Union countries.
format Working Paper
author Sanga, Dimitri
Gui-Diby, Steve Loris
author_facet Sanga, Dimitri
Gui-Diby, Steve Loris
author_sort Sanga, Dimitri
title Inflation Threshold Levels and Economic Growth in the Franc Zone Countries
title_short Inflation Threshold Levels and Economic Growth in the Franc Zone Countries
title_full Inflation Threshold Levels and Economic Growth in the Franc Zone Countries
title_fullStr Inflation Threshold Levels and Economic Growth in the Franc Zone Countries
title_full_unstemmed Inflation Threshold Levels and Economic Growth in the Franc Zone Countries
title_sort inflation threshold levels and economic growth in the franc zone countries
publisher World Bank, Washington, DC
publishDate 2020
url http://documents.worldbank.org/curated/en/956741600700107596/Inflation-Threshold-Levels-and-Economic-Growth-in-the-Franc-Zone-Countries
http://hdl.handle.net/10986/34503
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