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Business Cycle Synchronisation and Regional Migration: Testing the OCA Criteria in the West African Region

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  • Sodiq Olaiwola Jimoh

    (Universiti Sains Malaysia
    Kwara State University)

  • Soo Y. Chua

    (Universiti Sains Malaysia)

Abstract

The West African region is on the verge of forming a monetary union. Many studies have examined the feasibility of monetary unions using criteria such as trade and financial integrations. However, labour migration which is one of the criteria has been neglected in previous studies. This study filled the gap by using Abel and Cohen's (Bilateral international migration flow estimates for 200 countries 6(1):1–13, 2019) data between 1996–2019 to examine the impact of migration flows on business cycle synchronisation using the IV-2SLS technique in the West African region. The study reveals that migration flow, specialisation of industry, and financial integrations spur business cycle synchronisation, while regional trade integration does not significantly impact business cycle synchronisation. However, the interactive terms of trade integrations and migration flow positively influenced business cycle synchronisation in the region. These findings suggest a likelihood of optimum currency area in the West African region.

Suggested Citation

  • Sodiq Olaiwola Jimoh & Soo Y. Chua, 2024. "Business Cycle Synchronisation and Regional Migration: Testing the OCA Criteria in the West African Region," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 67(1), pages 97-108, March.
    • Handle: RePEc:spr:ijlaec:v:67:y:2024:i:1:d:10.1007_s41027-024-00480-x
    DOI: 10.1007/s41027-024-00480-x
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    More about this item

    Keywords

    Business cycle synchronisation; Currency union; Labour migration flows; West Africa; IV-2SLS;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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