African regional integration: An analysis of the possibility of advancing towards a supranational structure. a study using SVAR

The objective of this article is to identify the degree of (a)symmetry of macroeconomic shocks affecting African countries in order to test the possibility of progressing towards a supranational structure. To achieve this goal, we employ a structural VAR process to decompose the macroeconomic shocks and then determine their degree of correlation. The results show that the economies of the continent are marked by relatively high degrees of asymmetry, as the responses to the same type of shock differ. Indeed, 79.02% of the correlations of real supply shocks between African countries are asymmetric, as well as 86.76% of the correlations of demand shocks, and 88.13% of the correlations of monetary shocks. Thus, a deepening of integration towards the harmonization of policies would lead to an increase in real divergence between countries, resulting in a reinforcement of the asymmetry of shocks on the African continent. Keywords: Macroeconomic Shocks, Supranational Structure, SVAR Model, Degrees of Asymmetry.