Economic integration and synchronization of growth cycles in the WAEMU zone : A dynamic panel approach
Keywords:
synchronization of cycles, economic integration, dynamic panel, GMM, WAEMUAbstract
The purpose of this article is to find out how the degree of synchronization of real growth cycles in WAEMU is changing and to what extent does economic integration impact this synchronization. To answer these questions we introduced a new measurement approach and a dynamic panel type modeling estimated by the two-step conditional generalized moments method proposed by Arellano and Bond (1991) ; Bover and Blundell (1998). Our empirical analyzes have shown that the interrelationships between the UEMOA economies in terms of trade are very limited. Nevertheless, the bilateral synchronization of cycles, although weak, evolves since 2006. According to our empirical investigations, in sum, we can say that the results obtained suggest that the key determinants of the synchronization of the economic growth cycles in the UEMOA are the synchronization of the previous period, differences in production patterns, differences in inflation, and common external shocks.
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