Should African Monetary Unions Be Expanded? An Empirical Investigation of the Scope for Monetary Integration in Sub-Saharan Africa
AbstractThis paper develops a full-fledged cost-benefit analysis of monetary integration, and applies it to the currency unions actively pursued in Africa. The benefits of monetary union come from a more credible monetary policy, while the costs derive from real shock asymmetries and fiscal disparities. The model is calibrated using African data. Simulations indicate that the proposed EAC, ECOWAS, and SADC monetary unions bring about net benefits to some potential members, but modest net gains and sometimes net losses for others. Strengthening domestic macroeconomic frameworks is shown to provide some of the same improvements as monetary integration, reducing the latterâ€™s relative attractiveness.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 10/157.
Date of creation: 01 Jul 2010
Date of revision:
Contact details of provider:
Postal: International Monetary Fund, Washington, DC USA
Phone: (202) 623-7000
Fax: (202) 623-4661
Web page: http://www.imf.org/external/pubind.htm
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-07-31 (All new papers)
- NEP-CBA-2010-07-31 (Central Banking)
- NEP-MON-2010-07-31 (Monetary Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David Fielding & Kalvinder Shields, 2000.
"Modeling Macroeconomic Shocks in the CFA Franc Zone,"
Discussion Papers in Economics
00/7, Department of Economics, University of Leicester.
- Fielding, David & Shields, Kalvinder, 2001. "Modelling macroeconomic shocks in the CFA Franc Zone," Journal of Development Economics, Elsevier, vol. 66(1), pages 199-223, October.
- Roel Beetsma & Massimo Giuliodori, 2010.
"The Macroeconomic Costs and Benefits of the EMU and Other Monetary Unions: An Overview of Recent Research,"
Journal of Economic Literature,
American Economic Association, vol. 48(3), pages 603-41, September.
- Beetsma, Roel & Giuliodori, Massimo, 2009. "The Macroeconomic Costs and Benefits of the EMU and other Monetary Unions: An Overview of Recent Research," CEPR Discussion Papers 7500, C.E.P.R. Discussion Papers.
- Romain Houssa, 2004.
"Monetary Union in West Africa and Asymmetric Shocks: A Dynamic Structural Factor Model Approach,"
Development and Comp Systems
- Houssa, Romain, 2008. "Monetary union in West Africa and asymmetric shocks: A dynamic structural factor model approach," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 319-347, February.
- Romain Houssa, 2004. "Monetary Union in West Africa and Asymmetric Shocks: A Dynamic Structural Factor Model Approach," Economics Series Working Papers WPS/2004-17, University of Oxford, Department of Economics.
- Michal Hulej & Charalambos G. Tsangarides & Pierre Ewenczyk, 2006.
"Stylized Factson Bilateral Trade and Currency Unions,"
IMF Working Papers
06/31, International Monetary Fund.
- Charalambos Tsangarides & Pierre Ewenczyk & Michal Hulej & Mahvash Saeed Qureshi, 2009. "Are Africa's Currency Unions Good for Trade?," IMF Staff Papers, Palgrave Macmillan, vol. 56(4), pages 876-918, November.
- Mario Mansour & Michael Keen, 2009. "Revenue Mobilization in Sub-Saharan Africa," IMF Working Papers 09/157, International Monetary Fund.
- Tsangarides, Charalambos G. & Qureshi, Mahvash Saeed, 2008.
"Monetary Union Membership in West Africa: A Cluster Analysis,"
Elsevier, vol. 36(7), pages 1261-1279, July.
- Steven K. Buigut & Neven T. Valev, 2006.
"Eastern and Southern Africa Monetary Integration: A Structural Vector Autoregression Analysis,"
Review of Development Economics,
Wiley Blackwell, vol. 10(4), pages 586-603, November.
- Steven K. Buigut & Neven Valev, 2005. "Eastern and Southern Africa Monetary Integration: A Structural Vector Autoregression Analysis," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0504, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
- Carlos Vieira & Isabel Vieira, 2012.
"Monetary integration in Eastern and Southern Africa: choosing a currency peg for COMESA,"
CEFAGE-UE Working Papers
2012_03, University of Evora, CEFAGE-UE (Portugal).
- Carlos Vieira & Isabel Vieira, 2013. "Monetary Integration In Eastern And Southern Africa: Choosing A Currency Peg For Comesa," South African Journal of Economics, Economic Society of South Africa, vol. 81(3), pages 356-372, 09.
- Issiaka Coulibaly & Blaise Gnimassoun, 2012.
"Optimality of a monetary union : New evidence from exchange rate misalignments in West Africa,"
EconomiX Working Papers
2012-37, University of Paris West - Nanterre la Défense, EconomiX.
- Coulibaly, Issiaka & Gnimassoun, Blaise, 2013. "Optimality of a monetary union: New evidence from exchange rate misalignments in West Africa," Economic Modelling, Elsevier, vol. 32(C), pages 463-482.
- World Bank, 2012. "Reshaping Economic Geography of East Africa : From Regional to Global Integration (Vol. 1 of 2)," World Bank Other Operational Studies 11930, The World Bank.
- Hachicha, Ahmed & Lean Hooi Hooi, 2013. "Inflation, inflation uncertainty and output in Tunisia," Economics Discussion Papers 2013-1, Kiel Institute for the World Economy.
- Thomas Kigabo RUSUHUZWA & Paul Robert MASSON, 2012. "Design and Implementation of a Common Currency Area in the East African Community," Working Papers tecipa-451, University of Toronto, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow) or (Hassan Zaidi).
If references are entirely missing, you can add them using this form.