Sources of Inflation in Sub-Saharan Africa

Posted: 3 Nov 2008

See all articles by Régis Barnichon

Régis Barnichon

International Monetary Fund (IMF)

Shanaka J. Peiris

International Monetary Fund (IMF)

Date Written: November 2008

Abstract

This paper explores the sources of inflation in Sub-Saharan Africa by examining the relationship between inflation, the output gap and the real money gap. Using heterogeneous panel co-integration estimation techniques, we estimate co-integrating vectors for the production function and the real money demand function to recover the structural output and money gaps for 17 African countries. The central finding is that both gaps contain significant information regarding the evolution of inflation, albeit with a larger role played by the money gap. There is no significant evidence of asymmetry in the relationship.

Keywords: E3, E5, O4

Suggested Citation

Barnichon, Régis and Peiris, Shanaka J., Sources of Inflation in Sub-Saharan Africa (November 2008). Journal of African Economies, Vol. 17, Issue 5, pp. 729-746, 2008. Available at SSRN: https://ssrn.com/abstract=1292691 or http://dx.doi.org/ejn002

Régis Barnichon (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Shanaka J. Peiris

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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