Domestic Demand and Export Performance in CEMAC : Investigating from the Point of View of Capacity Constraints

Based on the unitary foreing demand assumption the literature builds on exports markets share equation to analyze the relationship between exports and domestic sales. The main caveat with this strategy for African countries such CEMAC area is that the foreign demand series is scare. Then because the role of capacity constraints in explaining this relationship have an alternative explanation to the domestic demand given by the output gap which is more available then the empirical strategy that implyng is relevant for assessing on this relationship. Using dynamic panel data modeling, in CEMAC area between 1974 and 2021 the outgap gap impacts effectively negatively exports with a negative unitary elasticity confirming thus the robustness of specification used from the point of view of capacity constraints as explained by the capacity of the economy to satisfy on exports markets with the domestic production when a country cares about the capacity constraints.