Bitte verwenden Sie diesen Link, um diese Publikation zu zitieren, oder auf sie als Internetquelle zu verweisen: https://hdl.handle.net/10419/206609 
Autor:innen: 
Erscheinungsjahr: 
2019
Schriftenreihe/Nr.: 
Economics Discussion Papers No. 2019-52
Verlag: 
Kiel Institute for the World Economy (IfW), Kiel
Zusammenfassung: 
Fiscally undisciplined and divergent, West African countries are in transition for establishing a monetary union that must be effective by 2020 with the introduction of a single currency named "ECO". From the economic literature, it is argued that business cycles desynchronization is counterproductive to the viability of a monetary union. In addition, in the famous paper of Darvas et al. (Fiscal divergence and business cycle synchronization: irresponsibility is idiosyncratic, 2015), it is argued that the existence of fiscal divergences among countries despite the definition of fiscal convergence criteria is counterproductive to business cycles coherence. Using a gravity model based on 2SLS strategy, the author tests this theory by analyzing the effect of the fiscal divergences among the West African countries on their business cycles synchronization. To obtain robust results, the author uses two different business cycle series. The results underscore that a 1% increase in fiscal divergence is associated on average with reduced business cycle coherence by 0.105%, or a 1% decrease in fiscal divergence is associated on average with a better coherence of the business cycle by 0.105%. Because of the existing fiscal divergences among the West African area, this paper proposes some indirect and direct fiscal mechanisms need to significantly reduce them. Indeed, these fiscal divergences could be harmful to the viability of the future regional monetary union.
Schlagwörter: 
fiscal divergence
business cycles
regional integration
single currency
West Africa
JEL: 
H61
H62
O47
Creative-Commons-Lizenz: 
cc-by Logo
Dokumentart: 
Working Paper

Datei(en):
Datei
Größe
3.18 MB





Publikationen in EconStor sind urheberrechtlich geschützt.