The Effects of Inflation on Employment in African Countries: A Non-dynamic Panel Threshold Approach

Abstract

The objective of this study is to empirically contribute to a better orientation of the inflation targeting policy. Specifically, it assesses the impact of inflation targeting on employment in 19 African countries. We used a non-dynamic panel threshold model applied to data that cover the period from 1992 to 2014. We found that, below an inflation rate of 9.16%, the employment ratio increases with inflation, while inflation does not impact the employment ratio beyond 9.16%.