Volume : VII, Issue : VIII, August - 2017

Bank financial accelerator and mitigation of transient asymmetry of shocks in the WAEMU

Honore Sewanoude. Houngbedji

Abstract :

 This paper provides a re–examination of the role of monetary policy in stabilizing asymmetric shocks. It seeks to test the hypothesis that the single monetary policy can, through a bank financial accelerator mechanism, mitigate the asymmetry of the transient shocks within the WAEMU. The analysis covers seven WAEMU countries over the period 1990–2015. Using an empirical model coupled with SURE (Seemingly Unrelated Regression Equation) estimator, the study shows that, apart from the BCEAO‘s policy interest rate, banking indicators (own funds and credit) are the main variables for mitigating the asymmetry of transient demand shocks, whereas, the liquidity and credit reduce the asymmetry of transient supply shocks in the WAEMU countries.

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Article: Download PDF   DOI : 10.36106/ijar  

Cite This Article:

Honore Sewanoude. HOUNGBEDJI, Bank financial accelerator and mitigation of transient asymmetry of shocks in the WAEMU, INDIAN JOURNAL OF APPLIED RESEARCH : Volume‾7 | Issue‾8 | August‾2017

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