Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/336916 
Year of Publication: 
2025
Citation: 
[Journal:] West African Journal of Monetary and Economic Integration [ISSN:] 0855-594X [Volume:] 24 [Issue:] 1 [Article No.:] 3 [Year:] 2025 [Pages:] 1-30
Publisher: 
West African Monetary Institute (WAMI), Accra
Abstract: 
This study examines the dynamic relationship between external debt and unemployment in West Africa, employing the Panel Autoregressive Distributed Lag (P-ARDL) method with the Pooled Mean Group (PMG) estimator. Annual data from 16 West African countries (1991-2021) were analysed. The results reveal a critical duality where external debt has a positive and marginally significant short-run impact on unemployment, but no statistically significant long-run relationship. This indicates that while debt accumulation may create immediate labour market pressures, its long-term effect on structural unemployment is conditional on institutional factors and debt utilisation efficiency. Control variables show inflation has a significant negative long-run relationship with unemployment, while GDP growth shows a positive long- run association, suggesting patterns of "jobless growth" in the region. The findings imply that West African governments have not consistently harnessed external borrowing for sustainable job creation. We recommend institutional reforms to explicitly link debt governance to employment outcomes, strategic investment in labour-intensive sectors, and enhanced regional coordination to transform external debt into a catalyst for inclusive growth.
Subjects: 
External Debt
Unemployment
Output
GDP Growth
Population Growth
Inflation
Autoregressive Distributed Lag (ARDL)
Pooled Mean Group (PMG
JEL: 
E24
F34
H63
J21
J64
Document Type: 
Article

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