Persistence of Inflationary shocks: Implications for West African Monetary Union Membership

Imhotep Alagidede (), Simeon Coleman () and Juan Cuestas

No 2010-11, Stirling Economics Discussion Papers from University of Stirling, Division of Economics

Abstract: Plans are far advanced to form a second monetary union, the West African Monetary Zone (WAMZ), in Africa. While much attention is being placed on convergence criteria and preparedness of the five aspiring member states, less attention is being placed on how the dynamics of inflation in individual countries are (dis)similar. This paper aims to stimulate debate on the long term sustainability of the union by examining the dynamics of inflation within these countries. Using Fractional Integration (FI) methods, we establish that some significant differences exist among the countries. Shocks to inflation in Sierra Leone are non mean reverting; results for The Gambia, Ghana and Guinea-Bissau suggest some inflation persistence, despite being mean reverting. Some policy implications are discussed and possible outstanding policy questions are raised.

Keywords: Inflationary shocks; fractional integration; stationarity; West Africa; Monetary unions (search for similar items in EconPapers)
Date: 2010-10
New Economics Papers: this item is included in nep-afr, nep-cba, nep-cis and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://hdl.handle.net/1893/2705

Related works:
Working Paper: Persistence of Inflationary Shocks: Implications for West African Monetary Union Membership (2010)
Working Paper: Persistence of Inflationary shocks: Implications for West African Monetary Union Membership (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:stl:stledp:2010-11

Access Statistics for this paper

More papers in Stirling Economics Discussion Papers from University of Stirling, Division of Economics Division of Economics, University of Stirling, Stirling, Scotland FK9 4LA. Contact information at EDIRC.
Bibliographic data for series maintained by Liam Delaney ( this e-mail address is bad, please contact ).