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Optimum Currency Area and Shock Asymmetry: A Dynamic Analysis of the West African Monetary Zone (WAMZ)

Author

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  • Omotor, Douglason G.

    (Department of Economics, Delta State University, Abraka, Nigeria)

  • Niringiye, Aggrey

    (Faculty of Economics and Management, Makerere University, Kampala, Uganda)

Abstract

This study accesses the feasibility of forming an Optimum Currency Area (OCA) in the West African Monetary Zone (WAMZ) from the symmetry of economic shocks which affect member economies. It applies a simple bivariate variant of the vector autoregressive (VAR) model. The results relatively suggest the feasibility of the WAMZ forming an OCA. The likelihood of incoming shocks problems seem to exists from the results. It is advisable that future research apply the more informative minimum distance estimation (MDE) technique.

Suggested Citation

  • Omotor, Douglason G. & Niringiye, Aggrey, 2011. "Optimum Currency Area and Shock Asymmetry: A Dynamic Analysis of the West African Monetary Zone (WAMZ)," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 71-82, September.
    • Handle: RePEc:rjr:romjef:v::y:2011:i:3:p:71-82
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    Cited by:

    1. Omotor, Douglason G., 2019. "A Thrifty North and An Impecunious South: Nigeria's External Debt and the Tyranny of Political Economy," MPRA Paper 115292, University Library of Munich, Germany, revised 12 Oct 2019.
    2. Mogaji, Peter Kehinde, 2016. "Inflation Deviations Assessments of OCA Properties in the WAMZ," MPRA Paper 98825, University Library of Munich, Germany.
    3. Mogaji, Peter Kehinde, 2016. "Monetary Integration Tests for the OCA’s Business Cycles Synchronicity Criteria in the WAMZ," MPRA Paper 99066, University Library of Munich, Germany.

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    More about this item

    Keywords

    optimum currency area; shocks; asymmetry; West African Monetary Zone; vector autoregressive.;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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