Abstract
Data from 19 African nations is used to investigate the hypothesis that monetary union—represented in this case by the CFA Franc Zone—augments the extent of macroeconomic integration. The paper covers two key dimensions of integration: the volume of bilateral trade, and the magnitude of cross‐country business cycle correlation. Restricting our attention to a part of the world in which (for historical reasons) monetary union membership is exogenous to economic characteristics, we can test whether the large single‐currency effects claimed by A. Rose apply within a sample of less developed countries.
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