TITLE:
Cycle Synchronization and Economic Convergence in ECCAS Zone
AUTHORS:
Ulrich Kevin Kamdoum Kamwa
KEYWORDS:
Business Cycle, Baxter and King Filter, Economic Convergence
JOURNAL NAME:
Theoretical Economics Letters,
Vol.10 No.5,
October
27,
2020
ABSTRACT: This article is part of the analysis of business
cycles and the convergence of integrated economies. In contrast to work on the
convergence of business cycles in a monetary union, we study the
synchronization of business cycles within
the Economic Community of Central African States (ECCAS), characterized by
heterogeneity monetary. Thus, we first extract cycles from GDP
using the Baxter and King (1999) filter; then
we date the cycles using the Bry and Boschan (BB, 1971) algorithm, and finally
we measure cyclical co-movements using the Harding and
Pagan (2006) concordance index. Furthermore, sigma-convergence is used to
measure the degree of closeness over time of the identified economies, on the
one hand, and beta-convergence to measure their adjustment process over time
with respect to a reference value, on the other hand. The results obtained
attest to the asynchronous nature of business cycles in the ECCAS zone over the
period from 1990 to 2018. Thus, a weak trend towards convergence, both nominal
(inflation, basic budget balance, public debt ratio) and real (GDP/capita and
GNI/capita) has been observed since 2001.