TY - JOUR
T1 - Money and income causality in developing economies
T2 - A case study of selected countries in sub-Saharan Africa
AU - Kalulumia, Pene
AU - Yourougou, Pierre
N1 - Funding Information:
1his research started when the second author was associate professor at Laval University. We are grateful to Guy Lacroix, Ben Amoaku-Adu, Linda Allen, Louis Ascah, and the two anonymous referees for their helpful comments on earlier versions of this paper. The project was partially funded by a grant from FCAR and another from sSHRC. The views and interpretations in this paper are strictly those of the authors and should not be attributed to the World Bank, to ifs affiliated organisations, or to any individual acting on their behalf.
PY - 1997/7
Y1 - 1997/7
N2 - This paper tests money-output causality and non-neutrality in five African countries, all members of the West African Monetary Union, using quarterly data for the period 1964 to 1993 and applying recent robust cointegration and dynamic modelling techniques. The real exchange rate, the price level and nominal money balances are used as determinants of long-run real output. Evidence indicates stronger money-output causality and non-neutrality for countries at a relatively more advanced stage in their industrial development such as Côte d'Ivoire and Senegal. The findings also show that Côte d'Ivoire is more affected by both permanent and transitory adjustments of the real exchange rate than the other members of the West African Monetary Union. The overall results are consistent with the literature supporting the non-neutrality of money in developing countries.
AB - This paper tests money-output causality and non-neutrality in five African countries, all members of the West African Monetary Union, using quarterly data for the period 1964 to 1993 and applying recent robust cointegration and dynamic modelling techniques. The real exchange rate, the price level and nominal money balances are used as determinants of long-run real output. Evidence indicates stronger money-output causality and non-neutrality for countries at a relatively more advanced stage in their industrial development such as Côte d'Ivoire and Senegal. The findings also show that Côte d'Ivoire is more affected by both permanent and transitory adjustments of the real exchange rate than the other members of the West African Monetary Union. The overall results are consistent with the literature supporting the non-neutrality of money in developing countries.
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U2 - 10.1093/oxfordjournals.jae.a020926
DO - 10.1093/oxfordjournals.jae.a020926
M3 - Article
AN - SCOPUS:0031472386
VL - 6
SP - 197
EP - 230
JO - Journal of African Economies
JF - Journal of African Economies
SN - 0963-8024
IS - 2
ER -