Inflation and Economic Growth in the SADC: Some Panel Time-Series Evidence

In this paper we investigate the role of inflation rates in determining economic growth in fifteen sub-Saharan African countries, which are all members of the Southern African Development Community (SADC), between 1980 and 2009. The results, based on panel time-series data and analysis, suggest that inflation has had a detrimental effect to growth in the region. All in all, we highlight not only the fact that inflation has offset the Mundell-Tobin effect and consequently reduced, the much needed, economic activity in the region, but also the importance of an institutional framework conducive to a stable macroeconomic environment as a precondition for development and prosperity in the community.