EconPapers    
Economics at your fingertips  
 

Policy Mix Coherence: What Does it Mean for Monetary Policy in West Africa?

Nasser Ary Tanimoune (), Jean-Louis Combes () and René Tapsoba ()
Additional contact information
Jean-Louis Combes: CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique

Working Papers from HAL

Abstract: This article examines the influence of Policy Mix coherence in Economic Community of West African States (ECOWAS). The paper innovates in two ways. First, through an interaction between the monetary conditions index and the primary structural fiscal balance, we highlight coherence-type complementarities between monetary policy and fiscal policy with regard to their effects on economic activity. Second, we show that the influence of the coherence of policy mix on the effect of monetary policy is different according to the stance of the economy within the four possible regimes of policy mix, mostly in the WAEMU subsample, where integration is deeper than in the non-WAEMU countries, thanks to the common currency (the Franc CFA) they share. The analysis is based upon a panel dataset from 1990 to 2006 and remains robust to alternative specifications used to calculate the monetary conditions index. Our results contribute to the debate regarding the prospect of an ECOWAS-wide common currency. Indeed, given the heterogeneity in the economic structure of its members States, more policy mix coherence seems necessary to avoid unexpected impacts of monetary policy on economic activity.

Keywords: Economic Community of West African States; Policy Mix; Structural Fiscal Balance; Monetary Conditions Index; Economic Community of West African States. (search for similar items in EconPapers)
Date: 2012-03-13
New Economics Papers: this item is included in nep-afr and nep-mon
Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00678712
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)
https://halshs.archives-ouvertes.fr/halshs-00678712/document (application/pdf)

Related works:
Working Paper: Policy Mix Coherence: What Does it Mean for Monetary Policy in West Africa? (2012) Downloads
Working Paper: Policy Mix Coherence: What Does it Mean for Monetary Policy in West Africa? (2012) Downloads
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:hal:wpaper:halshs-00678712

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().

 
Page updated 2022-05-30
Handle: RePEc:hal:wpaper:halshs-00678712