Economic convergence in the West African Economic and Monetary Union: a new analysis

Abstract

This paper uses a structural approach to analyse economic convergence within the West African Economic and Monetary Union (WAEMU) countries. This Regional Economic Community has recorded several postponements of the convergence horizon defined by the Economic Commission. However, it is a framework that is supposed to lead to economic growth and living conditions. So, we estimate a structural convergence model over 1996–2021 for the WAEMU panel of countries. We apply the Generalized Moment Method to address the endogeneity issue in evaluating the coefficient. The analysis confirms no economic convergence within WAEMU countries during this period. This finding means that the economic structures of the WAEMU countries do not come closer over time. Therefore, policymakers must continue implementing initiatives to harmonise regional policies and reinvigorate the regional economic program.

Keywords:

• Economic convergence
• structural characteristics
• growth
• income disparity
• Development

REVIEWING EDITOR:

• Yamini Sharma
• Taylor and Francis
• India

SUBJECTS:

• Economics
• Development Studies
• Development policy

JEL CLASSIFICATION CODES:

• C13
• O47

Data availability statement

The data supporting the findings of this study are available from the corresponding author upon reasonable request.

Author contributions

Doukouré Charles Fe: the conception and design of the study, analysis, and interpretation of data, revising the paper for intellectual content, and final approval of the version to be published. Adou Christian Konin: data collection, descriptive analysis, interpretation of the data, revising the paper for intellectual content, and drafting of the paper. Akra Mohaye Marius N'Guessan: final estimation, interpretation of estimation results, drafting of the final version of the paper, and revising the paper for intellectual content.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 ADDITIONAL ACT No. 04/99 on the Convergence, Stability, Growth and Solidarity Pact between the Member States of the West African Economic and Monetary Union (WAEMU).

2 Additional Act No. 03/2003 amending Additional Act No. 04/99 of 8 December 1999 on the Convergence, Stability, Growth and Solidarity Pact among the WAEMU Member States.

3 GDP per capita in purchasing power parity at constant prices 2011.

4 Additional Act No. 02/2006 amending Additional Act No. 04/99 of 8 December 1999 on the Convergence, Stability, Growth and Solidarity Pact between the WAEMU Member States.

5 Additional Act No. 05/2009/CCEG/UEMOA amending Additional Act No. 04/99 of 8 December 1999, relating to the Convergence, Stability, Growth and Solidarity Pact.

6 Additional Act No. 01/2015/CCEG/UEMOA establishing the Convergence, Stability, Growth and Solidarity Pact between the Member States of the West African Economic and Monetary Union (WAEMU).

7 The New Pact was established by Additional Act No. 01/2015/CCEG/UEMOA. According to Article 3, the convergence phase goes from 1 January 2015 to 31 December 2019, while the stability phase would begin late on 1 January 2020.

8 This method makes it possible to correct the endogeneity bias of the variable $Y_{i,t-1.}$

Additional information

Funding

This paper has not received any funding. The analysis reflects only the authors’ views.

Notes on contributors

Doukouré Charles Fe

Doukouré Charles Fe Lecturer-Researcher at Ecole Nationale Supérieure de Statistique et d’Economie Appliquée (ENSEA), Abidjan (Côte d’Ivoire). I teach International trade theory, Macroeconomics and Statistics. He earned my PhD in Economics from the University Paris 1 Pantheon Sorbonne in France. I am a senior associate researcher at the Economic Policy Analysis Unit of the Ivoirian Centre for Economic and Social Research. My research interests focus on regional trade agreements, international economics, and applied statistics.

Adou Christian Konin

Adou Christian Konin and Akra Mohaye Marius N’Guessan Master Student in Statistics and Applied Economics at Ecole Nationale Supérieure de Statistique et d’Economie Applqiuée (ENSEA), Abidjan (Côte d’Ivoire). Both are currently in the last year of training when they carried this paper.

Akra Mohaye Marius N'Guessan

Adou Christian Konin and Akra Mohaye Marius N’Guessan Master Student in Statistics and Applied Economics at Ecole Nationale Supérieure de Statistique et d’Economie Applqiuée (ENSEA), Abidjan (Côte d’Ivoire). Both are currently in the last year of training when they carried this paper.