Inflation-targeting vs. non-inflation-targeting Regimes and Macroeconomic Performance in Africa: Evidence from econometrics approaches

Inflation-targeting vs. non-inflation-targeting Regimes and Macroeconomic Performance in Africa: Evidence from econometrics approaches | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Inflation-targeting vs. non-inflation-targeting Regimes and Macroeconomic Performance in Africa: Evidence from econometrics approaches Hassan Tawakol Ahmed Fadol This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7502485/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract This study uses panel VECM, VAR, and impulse response analysis to evaluate African economies with and without inflation-targeting frameworks. The findings suggest that inflation-targeting regimes provide stronger price and growth stability, whereas non-inflation-targeting economies confront chronic inflation, exchange rate instability, and fiscal dominance. In inflation-targeting economies, inflation shocks provide only temporary benefits, whereas in non-inflationary regimes, they exacerbate long-term instability. Overall, inflation targeting improves trust and resilience, but its efficacy is limited by structural flaws, particularly in exchange rate control. Policy options include increasing central bank independence, enhancing fiscal-monetary cooperation, and implementing progressive institutional reforms to support effective targeting regimes. JEL Classification E31; E52; E62; C33; O55 Microeconomics Econometrics Development Economics Inflation Targeting Non-Inflation Targeting Macroeconomic Stability Panel VECM Panel VAR African economies Full Text Additional Declarations The authors declare no competing interests. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7502485","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":508119663,"identity":"e2a7f2ae-b4f4-44cb-a92e-cbc2f4288b1f","order_by":0,"name":"Hassan Tawakol Ahmed Fadol","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAABA0lEQVRIiWNgGAWjYFCCBMYDEAZj44MPBjZgxgECWhigCpibDWcUpIG0NBCrhb1NmufDYTATrxaD48kPDvxss5HjZz/YJjnD4Lzd2vbDQFtqbKJxajnzzOBgb1uasWRPYrPFB4PbydvOJAK1HEvLbcChxexGgsEB3m2HEzccSGy8OQOoxewAUAtjw2E8WtI/HPy77X/9/vMPG6R5DM4lmwEZBLTkGBzm3XYgwUAisQmo5YCd2Q0CttifeVNwWPZfsuGMGw+BgWyQnGB2A2hLAh6/SLanb3z45oydPH9/+sMHH/7Y2ZudBzFqbHBqwQCJYJUJxCoHu5QUxaNgFIyCUTAyAAAQjXJ0M9EuMAAAAABJRU5ErkJggg==","orcid":"https://orcid.org/0000-0003-4456-9082","institution":"Sudan University of Science and Technology","correspondingAuthor":true,"prefix":"","firstName":"Hassan","middleName":"Tawakol Ahmed","lastName":"Fadol","suffix":""}],"badges":[],"createdAt":"2025-08-31 19:19:34","currentVersionCode":1,"declarations":{"humanSubjects":false,"vertebrateSubjects":false,"conflictsOfInterestStatement":false,"humanSubjectEthicalGuidelines":false,"humanSubjectConsent":false,"humanSubjectClinicalTrial":false,"humanSubjectCaseReport":false,"vertebrateSubjectEthicalGuidelines":false},"doi":"10.21203/rs.3.rs-7502485/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7502485/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":90461204,"identity":"7cf13aa7-ee94-495b-9c75-a548f646a051","added_by":"auto","created_at":"2025-09-03 04:05:52","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":857948,"visible":true,"origin":"","legend":"","description":"","filename":"Manuscript.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7502485/v1_covered_4ae4ffcb-4e58-4011-875f-82b94d6da72b.pdf"}],"financialInterests":"The authors declare no competing interests.","formattedTitle":"\u003cp\u003e\u003cstrong\u003eInflation-targeting vs. non-inflation-targeting Regimes and Macroeconomic Performance in Africa: Evidence from econometrics approaches\u003c/strong\u003e\u003c/p\u003e","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":true,"hideJournal":true,"highlight":"","institution":"Sudan University of Science and Technology","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Inflation Targeting, Non-Inflation Targeting, Macroeconomic Stability, Panel VECM, Panel VAR, African economies","lastPublishedDoi":"10.21203/rs.3.rs-7502485/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7502485/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eThis study uses panel VECM, VAR, and impulse response analysis to evaluate African economies with and without inflation-targeting frameworks. 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