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Financial Repression and Economic Growth: Insights from CEMAC and UEMOA

Year: 2026

Type: article

Abstract: This study investigates the direct impact of financial repression on economic growth in the Central African Economic and Monetary Community (CEMAC) and the West African Economic and Monetary Union (UEMOA) using a lagged composite repression index and panel fixed-effects regressions. Contrary to theoretical expectations, lagged repression exhibits a significantly positive association with GDP growth in the main model, with robustness checks confirming no negative direct effect. The findings suggest that in pegged currency unions, repression may support growth through public channels or forced savings, offsetting private crowding-out, while capital formation remains a key driver. This effect, contrasting with repression’s negative impact on investment, highlights union-specific resilience and calls for calibrated reforms to balance stability with deepening.

Source: Economies

DOI: 10.3390/economies14050154

Author: Amirreza Kazemikhasragh

Institution: Universidad Complutense de Madrid

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: gold

Estimated APC paid: $2,172