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Poverty and Growth in the WAEMU after the 1994 Devaluation

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  • Jean-Paul Azam

Abstract

This paper brings out that poverty increased massively in the wake of the 1994 devaluation of the CFA franc, despite a significant recovery of economic growth. Although this increase affected all the social groups, it fell mostly on the urban poor. An analytical model is presented, which explains this puzzle by the stratification of the labour market, assuming that the formal sector workers are at the same time the investors in the informal sector.

Suggested Citation

  • Jean-Paul Azam, 2004. "Poverty and Growth in the WAEMU after the 1994 Devaluation," WIDER Working Paper Series RP2004-19, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:rp2004-19
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    File URL: https://www.wider.unu.edu/sites/default/files/rp2004-019.pdf
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    References listed on IDEAS

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    1. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    2. Aryeetey, Ernest & Udry, Christopher, 1997. "The Characteristics of Informal Financial Markets in Sub-Saharan Africa," Journal of African Economies, Centre for the Study of African Economies, vol. 6(1), pages 161-203, March.
    3. Casella, Alessandra & Eichengreen, Barry, 1996. "Can Foreign Aid Accelerate Stabilisation?," Economic Journal, Royal Economic Society, vol. 106(436), pages 605-619, May.
    4. Rama,Martin G., 1998. "Wage misalignment in CFA countries: are labor market policies to blame?," Policy Research Working Paper Series 1873, The World Bank.
    5. Alesina, Alberto & Drazen, Allan, 1991. "Why Are Stabilizations Delayed?," American Economic Review, American Economic Association, vol. 81(5), pages 1170-1188, December.
    6. Azam, Jean-Paul, 1997. "Public Debt and the Exchange Rate in the CFA France Zone," Journal of African Economies, Centre for the Study of African Economies, vol. 6(1), pages 54-84, March.
    7. M Rama, 2000. "Wage misalignment in CFA countries: were labour market policies to blame?," Journal of African Economies, Centre for the Study of African Economies, vol. 9(4), pages 475-511.
    8. Demery, Lionel & Squire, Lyn, 1996. "Macroeconomic Adjustment and Poverty in Africa: An Emerging Picture," The World Bank Research Observer, World Bank, vol. 11(1), pages 39-59, February.
    9. Fernandez, Raquel & Rodrik, Dani, 1991. "Resistance to Reform: Status Quo Bias in the Presence of Individual-Specific Uncertainty," American Economic Review, American Economic Association, vol. 81(5), pages 1146-1155, December.
    10. repec:dau:papers:123456789/4708 is not listed on IDEAS
    11. Jean Paul Azam & Bruno Biais & Magueye Dia & Christine Maurel, 2001. "Informal and Formal Credit Markets and Credit Rationing in Côte D'Ivoire," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 17(4), pages 520-534.
    12. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
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    Cited by:

    1. WARBURTON Christopher E.S., 2014. "Time Dynamics Of Stabilization Theories And Responses To Debt And Financial Crises: An Analysis Of Mexico, Argentina, Nigeria And Ghana, 1960-2011," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 14(2).
    2. Florence Bouvet & Roy Bower & Jason C. Jones, 2022. "Currency Devaluation as a Source of Growth in Africa: A Synthetic Control Approach," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 48(3), pages 367-389, June.
    3. Michael Grimm & Isabel Günther, 2005. "Inter- and Intra-household Linkages Between the Informal and Formal Sector: a Case Study for Urban Burkina Faso," WIDER Working Paper Series RP2005-14, World Institute for Development Economic Research (UNU-WIDER).
    4. Azam, Jean-Paul & Dia, Magueye, 2004. "Pro-Poor Growth in Senegal," IDEI Working Papers 325, Institut d'Économie Industrielle (IDEI), Toulouse.
    5. Mason, Nicole M. & Jayne, T.S. & Chapoto, Antony & Donovan, Cynthia, 2011. "Putting the 2007/2008 global food crisis in longer-term perspective: Trends in staple food affordability in urban Zambia and Kenya," Food Policy, Elsevier, vol. 36(3), pages 350-367, June.
    6. Pau Baizan & Amparo González-Ferrer, 2016. "What drives Senegalese migration to Europe? The role of economic restructuring, labor demand, and the multiplier effect of networks," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 35(13), pages 339-380.
    7. Isabel Günther & Mohamed Ali Marouani & Marc Raffinot, 2006. "La croissance est-elle pro-pauvres au Mali ?," Working Papers DT/2006/15, DIAL (Développement, Institutions et Mondialisation).
    8. Mr. Montfort Mlachila & Mr. Tidiane Kinda, 2011. "The Quest for Higher Growth in the WAEMU Region: The Role of Accelerations and Decelerations," IMF Working Papers 2011/174, International Monetary Fund.

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