Monetary policy channels, sectoral outputs and sustainable growth in the ECOWAS region: a rigorous analysis and implications for policy

Orji, Anthony, Ekeocha, Davidmac Olisa ORCID: 0000-0001-7098-0874, Ogbuabor, Jonathan E and Anthony-Orji, Onyinye I ORCID: 0000-0003-4032-7051 (2022) Monetary policy channels, sectoral outputs and sustainable growth in the ECOWAS region: a rigorous analysis and implications for policy. EconomiA, 23 (1). pp. 105-122.

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Official URL: http://dx.doi.org/10.1108/econ-06-2022-0048

Abstract

<jats:sec><jats:title content-type="abstract-subheading">Purpose</jats:title><jats:p>The market-based monetary policy framework has been favoured by Economic Community of West African States (ECOWAS) economies. Hence, this study aims to investigate the effect of monetary policy channels on the sectoral value added and sustainable economic growth in ECOWAS. Data from the World Bank and International Monetary Fund over 2013–2019 were sourced for thirteen member countries. ECOWAS is found to have very high inflation level, interest and exchange rates.</jats:p></jats:sec><jats:sec><jats:title content-type="abstract-subheading">Design/methodology/approach</jats:title><jats:p>The study adopted the Driscoll–Kraay fixed-effects ordinary least squares regression (OLS) estimator.</jats:p></jats:sec><jats:sec><jats:title content-type="abstract-subheading">Findings</jats:title><jats:p>The findings revealed that while the effect of monetary policy channels on the agricultural sector value added is largely heterogenous and significantly in-elastic, the one on the industrial and services sectors are overwhelmingly homogeneous and negative, but insignificant for the services sector. Moreover, the effect of monetary policy channels on sustainable economic growth is also homogeneously asymmetric, with imminent stagflation, while the interactive effects of monetary policy channels are heterogeneous on sustainable economic growth and economic sectors. Therefore, an inflation targeting monetary policy stance is generally recommended with prioritised exchange rate stabilisation amid sufficient fiscal space.</jats:p></jats:sec><jats:sec><jats:title content-type="abstract-subheading">Originality/value</jats:title><jats:p>This is amongst the first studies to investigate monetary policy channels, sectoral outputs and sustainable growth in the ECOWAS region with a rigorous analysis and found implications for policy.</jats:p></jats:sec>

Item Type:	Article
Uncontrolled Keywords:	Generic health relevance, 8 Decent Work and Economic Growth
Divisions:	Faculty of Humanities and Social Sciences > School of Management
Depositing User:	Symplectic Admin
Date Deposited:	19 Mar 2024 15:12
Last Modified:	19 Mar 2024 15:12
DOI:	10.1108/econ-06-2022-0048
Open Access URL:	https://www.emerald.com/insight/content/doi/10.110...
Related URLs:	Publisher
URI:	https://livrepository.liverpool.ac.uk/id/eprint/3179523