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Economic integration in Africa

  • Adom, Assandé Désiré
  • Sharma, Subhash C.
  • Morshed, A.K.M. Mahbub

There is a renewed interest in the debate on integration in Africa since the creation of the African Union in 2002. This study investigates the feasibility of a full-fledged economic union in Africa. Towards this goal, we examine the short- and long-term relationships among key macro-variables in eight largest African economies during the period from 1976 to 2005. We observe the existence of common long-term trends in real output, price level, private consumption, government consumption, investment and trade flows among these eight countries. In addition, we observe that there exists common cycles (short-term relationships) in real output, investment and trade flows for these countries. These two critical findings indicate the presence of macroeconomic interdependence among these countries which is a crucial factor for the success of integration in Africa led by these eight countries.

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Article provided by Elsevier in its journal The Quarterly Review of Economics and Finance.

Volume (Year): 50 (2010)
Issue (Month): 3 (August)
Pages: 245-253

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Handle: RePEc:eee:quaeco:v:50:y:2010:i:3:p:245-253
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/620167

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