Regional economic integration and its impact on income distribution and the poverty level: The case of the WAEMU zone

Main Article Content

ClaIre E. W. Yameogo
Joseph A. Omojolaibi


This study investigated the influence of regional economic integration (REI) on poverty reduction and the revenue distribution in the West African Economic and Monetary Union (WAEMU) over the period 1994–2018. The second generation panel unit root tests and the Westerlund panel cointegration test were employed for preliminary analysis. The elasticities of the variables were investigated using the Pooled Mean Group (PMG) approach. The results showed that REI reduced income inequality and increased the poverty rate. Moreover, the causal relationship revealed the presence of a bidirectional relationship between REI and poverty. The feedback causal effect operated between REI and remittances, while unidirectional causality runs from REI to income inequality, from economic growth per capita to income inequality, from remittances to poverty, from the control of corruption to income inequality, and from remittances to economic growth. Consequently, the study recommends an easing of governmental regional integration restrictions and provision of subsidies that help to increase the volume of trade and financial development while reducing poverty in the union.


Download data is not yet available.

Article Details

How to Cite
Yameogo, C. E. W., & Omojolaibi, J. A. (2022). Regional economic integration and its impact on income distribution and the poverty level: The case of the WAEMU zone. Quaestiones Geographicae, 41(2), 21-35.


  1. Adams R.H., Jr., Cuecuecha A., 2013. The impact of remittances on investment and poverty in Ghana. World Development 50: 24-40.
  2. Agénor P.R., 2004. Does globalization hurt the poor? International Economics and Economic Policy 1(1): 21-51.
  3. Alderson A., Nielsen F., 2002. Globalization and the great U-turn: Income inequality trends in 16 OECD countries. American Journal of Sociology 107: 1244-1299.
  4. Anyanwu J.C., 2011. International remittances and income inequality in Africa. Review of Economic and Business Studies 4(1): 117-148.
  5. Arellano M., Bover O., 1995. Another look at the instrumental variable estimation of error-components models. Journal of Econometrics 68(1): 29-51.
  6. Beckfield J., 2006. European integration and income inequality. American Sociological Review 71(6): 964-985.
  7. Beckfield J., 2008. The net effect of regional integration on total income inequality in the European union. Presented at the conference on Inequality Beyond Globalization: Economic Changes and the Dynamics of Inequality in Neuchatel, Switzerland.
  8. Bergh A., Nilsson T., 2011. Globalization and absolute poverty – A panel data study. IFN Working Paper No. 862, Stockholm, Sweden.
  9. Bose T.K., Bristy J.F., 2017. Are countries participating into regional integration performing better in growth and liberalization than non-participators? A study on European countries. International Journal of Business and Management 12(2): 171-198.
  10. Breusch T.S., Pagan A.R., 1980. The Lagrange multiplier test and its application to model specifications in econometrics. Review of Economic Studies 47: 239-253.
  11. Bui T., Dungey M., Nguyen C., Pham P., 2016. Impacts of economic integration on living standards and poverty reduction of rural households. Munich Personal RePEc Archive (MPRA) Paper No. 71129. Online: (accessed: 1 September 2021).
  12. Bukhari M., Munir K., 2016. Impact of globalization on income inequality in selected Asian countries. Munich Personal RePEc Archive (MPRA) Paper No. 74248.
  13. Castilho M., Menéndez M., Sztulman A., 2009. Trade liberalization, inequality and poverty in Brazilian states. Document de travail DT/2010-02, Institut de Recherche pour le Développement (IRD), Dauphine Université Paris, France.
  14. Cornia G.A., 2011. Economic integration, inequality and Growth: Latin America versus the European Economics in Transition. Reviews of Economics and Institutions 2(2): 31.
  15. De Melo J., Gourdon J., Maystre N., 2006. Openness, inequality and poverty: Endowments matter. Centre for Economic Policy Research (CEPR) Discussion Papers No. 5738. London.
  16. Dumitrescu E.I., Hurlin C., 2012. Testing for granger non-causality in heterogeneous panels. Economic Modelling 29(4): 1450-1460. DOI:
  17. Ean T.G., Mansor S.B.A., Ling S.W.S., 2020. Regional economic integration and income inequality in selected ASEAN countries. International Journal of Academic Research in Business and Social Sciences 10(2): 648-664. DOI:
  18. Ezaki M., Nguyen T.D., 2008. Regional economic integration and its impact on growth, income distribution and poverty in East Asia: A CGE analysis. Graduate School of International Development (GSID) Discussion Paper No. 167. Nagoya University, Japan.
  19. Foster J., Greer J., Thorbecke E., 1984. A class of decomposable poverty measures. Econometrica 52(3): 761-766. Online:
  20. Hartono D., Priyarsono D.S., Nguyen T.D., Ezaki M., 2007. Regional economic integration and its impacts on growth, poverty and income distribution: The case of Indonesia. RURDS 19(2): 138-153. DOI:
  21. Huh H.-S., Park C.-Y., 2019. A new index of globalization: Measuring impacts of integration on economic growth and income inequality. Asian Development Bank (ADB) Economics Working Paper Series No. 544, Philippines. DOI:
  22. Javid M., Arif U., Qayyum A., 2012. Impact of remittances on economic growth and poverty. Academic Research International 2(1): 433-447.
  23. Kousar R., Rais S.I., Mansoor A., Zaman K., Shah S.T.H., Ejaz S., 2019. The impact of foreign remittances and financial development on poverty and income inequality in Pakistan: Evidence from ARDL-Bounds testing approach. Journal of Asian Finance, Economics and Business 6(1): 71-81.
  24. Kuznets S., 1955. Economic growth and income inequality. The American Economic Review 45(1): 1-28.
  25. Kweka J., Mboya P., 2004. Regional integration and poverty: A case study of Tanzania. Working Paper, Economic and Social Research Foundation, Dar es Salaam.
  26. Meschi E., Vivarelli M., 2009. Trade and income inequality in developing countries. World Development 37(2): 287-302.
  27. Mishkin F.S., 2009. Globalization and financial development. Journal of Developing Economics 89: 164-169. DOI:
  28. Muriel E.S.A., Guo P., 2016. Regional economic integration and income inequality in Latin America: The case of the Andean Community of Nations. Journal of Economics and Sustainable Development 7(14): 176-185.
  29. Muriel E.S.A., Guo P., Kwami O.W., 2018. Regional integration and income inequality in ECOWAS zone. Journal of Economic Integration 33(3): 604-628.
  30. Nguyen T.D., Ezaki M., 2005. Regional economic integration and its impacts on growth, poverty and income distribution: The case of Vietnam. RURDS 17(3): 197-215.
  31. Okafor I.B., 2013. Revisiting the legal framework for African economic and monetary integration: Lessons from European economic depression. Journal of Sustainable Development Law and Policy 1(1): 100-113.
  32. Onyekwena C., Oloko T.F., 2016. Regional trade for inclusive development in West Africa. Centre for the Study of the Economies of Africa (CSEA) Working Paper WPS/16/03. Abuja, Nigeria.
  33. Osakwe P.N., 2015. Transformative regionalism, trade and the challenge of poverty reduction in Africa. Trade and Poverty Paper Series No.1, UNCTAD.
  34. Park C.-Y., Claveria R., 2018a. Constructing the Asia-Pacific regional cooperation and integration index: A panel approach. ADB Economics Working Paper Series No. 544.
  35. Park C.-Y., Claveria R., 2018b. Does regional integration matter for inclusive growth? Evidence from the multidimensional regional integration index. Asian Development Bank (ADB) Economics Working Paper Series No. 559. The Philippines.
  36. Pesaran M.H., 2004. General diagnostic tests for cross section dependence in panels. Institute for the Study of Labor (IZA) Discussion Paper No. 1240, University of Cambridge.
  37. Pesaran M.H., 2007. A simple panel unit root test in the presence of cross section dependence. Journal of Applied Economics 22: 265-312.
  38. Pesaran M.H., Pesaran M.H., Shin Y., Smith R.P., 1999. Pooled mean group estimation of dynamic heterogeneous panels. Journal of American Statistics Association 94: 621-634. DOI:
  39. Saikkonen P., 1991. Asymptotically efficient estimation of cointegration regressions. Econometric Theory 7(1): 1-21.
  40. Sharma N.K., 2013. Globalization and its impact on the third world economy. Crossing the Border: International Journal of Interdisciplinary Studies 1(1): 21-28.
  41. Solt F., 2019. The standardized world income inequality database, Version 8. Harvard Dataverse 2. DOI:
  42. Stock J., Watson M., 1993. A simple estimator of cointegrating vectors in higher order integrated systems. Econometrica 61(4): 783-820.
  43. Westerlund J., 2007. Testing for error correction in panel data. Oxford Bulletin and Economic Statistics 69: 709-748. DOI:
  44. Zafar M.W., Saud S., Hou F., 2019. The impact of globalization and financial development on environmental quality: Evidence from selected countries in the Organization for Economic Co-operation and Development (OECD). Environmental Science and Pollution Research 26(13): 13246-13262. DOI: