An Index of African Monetary Integration (IAMI)

Abstract

ABSTRACT This study improves the African Regional Integration Index (ARII) proposed by the African Union, the African Development Bank, and the United Nations Economic Commission for Africa by providing a theoretical framework and addressing shortcomings related to the weighting and aggregation of the indicator. This article measures monetary integration in the eight African Regional Economic Communities (RECs) by constructing an Index of African Monetary Integration (IAMI). It proposes an optimal currency area as a theoretical framework and uses a panel approach to appreciate the dynamics of the index over different periods of time.