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This study investigates the possibility of forming a monetary union across West Africa. This was achieved by employing the structural VAR framework. Data on real GDP, inflation, and exchange rate were used to represent supply, monetary, and demand shocks from the period 1986 to 2020. The impulse response and variance decomposition results showed that shocks affecting the West African region are idiosyncratic, while the residuals of the structural VAR were used to compute the correlation coefficient. The correlation coefficient revealed that the demand and monetary shocks were symmetric across WAEMU countries and asymmetric for the rest of the region. The study suggests that the West African region is not ripe for a monetary union. However, the study opined that the WAEMU countries are the closest to forming a West African monetary union and a piecemeal approach may be adopted such that the WAEMU countries are the first to form the union, while the rest may join when they meet the convergence criteria. In essence, West African countries' central banks need to focus on harmonizing their monetary policies and remove all barriers to factor mobility for the synchronization of shocks and for all countries to meet the convergence criteria.

Globalization opens up economies and encourages the free movement of persons and factors of production. Diaspora investors and workers earn income in the process and make remittances to the migrating countries. We examine the impact of the remittance inflow on the macroeconomic performance of top emigrating countries, which comprise nine emerging and two advanced economies. We conduct group and individual country analyses with distinct econometric models (Feasible Quasi Generalized Least Squares and Dynamic Common Correlated Effects) using data between 1987 and 2021. The results reveal positive impact of remittance inflows on nominal GDP and nominal GDP per capita and on real GDP and real GDP per capita, although evidence on the latter is weaker. In all, the emigrating countries can benefit from diaspora remittance in terms of improved productivity and macroeconomic performance. We therefore recommend better systems to facilitate remittance receipt and policies to channel such flows more into investment activities.

AbstractThis study investigated the effect of government expenditure on real growth in ECOWAS countries. This paper used panel cointegration techniques to examine the impact of government expenditure on economic growth for a sample of 15 ECOWAS countries between 1999 and 2021. The study uses the POLS, FMOLS, and DOLS techniques for estimating four models. The study supports the view that government expenditure positively affects real economic growth in ECOWAS countries. However, we also found that higher control of corruption improves the effectiveness and efficiency of government expenditure in promoting economic growth. Furthermore, a higher incidence of conflict minimizes the effectiveness and efficiency of government expenditure in promoting economic growth. The finding suggests that a well-managed government can contribute positively to economic growth. The finding that government expenditure positively affects real growth in ECOWAS countries suggests that a well-managed government can contribute positively to economic growth. This finding is helpful for policymakers in ECOWAS countries interested in improving their countries' economic growth.