Relationship between Inflation and Economic Growth in the West African Economic and Monetary Union (WAEMU): A Search for New Evidence of Causality

AGBOTON, Damien Joseph (2024): Relationship between Inflation and Economic Growth in the West African Economic and Monetary Union (WAEMU): A Search for New Evidence of Causality. Forthcoming in:

Abstract

In this article, we use recently developed panel causality and cointegration techniques to examine the long-term relationship between inflation and economic growth in the 8 WAEMU countries. A panel of 256 observations was thus constituted from the IMF (WDI) and CBWAS database. Our results highlight a unidirectional causality between inflation and economic growth and support the view that public spending controls can reduce inflation. Economic growth is the main channel through which economic policy can influence inflation. Furthermore, improving the quality of the workforce can further strengthen economic growth.

• Item Type: MPRA Paper
• Language: English
• Keywords: Inflation Economic growth Panel causality Panel cointegration WAEMU
• Subjects: E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy; E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles; E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E31 - Price Level ; Inflation ; Deflation

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