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1. Residual capacity and the political economy of pandemic response in Ghana

Author:
Kofi Takyi Asante
Publication Date:
04-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
On the whole, poor countries in Africa and elsewhere seem to have weathered the coronavirus (SARS-CoV-2, or COVID-19) pandemic better than wealthier countries with superior healthcare systems. Using the Ghanaian case, this paper draws on newspaper articles, policy statements, and other secondary sources to explain how the country’s competitive clientelist political settlement mediated the public health outcomes of the pandemic. It argues that while it lacks overall state capacity, Ghana was able to surmount the limitations of its weak and underresourced public health system by leveraging ‘residual capacity’ from previous public health programmes and a strong proactive response from the continental and subregional organizations. The government’s strong early response enabled it to gain control of the situation in the crucial first few months of the outbreak. However, with an upcoming election later in the year and unwilling to bear the political costs of sustaining its initial efforts, the government subsequently wavered in its response. The country’s infection and death rates spiked and dipped in response to these waves of enforcement. The paper concludes with a brief discussion of the limits of ‘residual capacity’ in public service delivery.
Topic:
State, Public Health, Settlements, COVID-19, and Clientelism
Political Geography:
Africa and Ghana

2. The effectiveness of social protection in five African countries through normal times and times of crisis

Author:
Katrin Gasior, Iva V. Tasseva, and Gemma Wright
Publication Date:
12-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We study the effectiveness of social protection benefits in reducing income and consumption poverty in five sub-Saharan African countries—Ghana, Mozambique, Tanzania, Uganda, and Zambia—in normal times and times of widespread economic crisis. Using tax–benefit microsimulation models with representative household survey data, first we estimate the coverage of benefits and their poverty-reducing effects in each country. Second, we study the ability of benefit automatic stabilizers to reduce losses in incomes and consumption in times of crisis, by simulating hypothetical reductions to earnings and employment. Although the coverage of benefits is fairly high in Ghana and Zambia, the poverty-reducing impact of benefits in all five countries is low in normal times. The effectiveness of benefits to stabilize income and consumption in times of crisis is also limited because many benefits are linked to proxies of income, not income itself, or have tight eligibility criteria. Social assistance programmes are typically unresponsive to losses in household earnings and employment and provide limited support for unemployed people.
Topic:
Poverty, Crisis Management, Economic Crisis, and Income
Political Geography:
Uganda, Africa, Mozambique, Tanzania, Zambia, and Ghana

3. Marketable Wealth in a Poor African Country: Using an index of consumer durables to investigate wealth accumulation by households in Ghana

Author:
Frikkie Booysen, Ronelle Burger, Servaas van der Berg, and Michael von Maltitz
Publication Date:
11-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The study uses an asset index of consumer durables to track changes in household wealth in Ghana during the recent period of strong growth. Using the Ghana Living Standards Survey of 1998 that contains both wealth data and consumer durable data, the authors demonstrate that the asset index approximate marketable wealth adequately. Although asset index estimates of wealth cannot match the precision of wealth surveys, this approach can provide useful information on marketable wealth in countries where more appropriate sources are not available. The asset index analysis with the three demographic and health surveys for 1993, 1998 and 2003 suggests that the solid economic growth seen over this period has been accompanied by a strong rise in the average asset index scores.
Topic:
International Relations, Development, and Political Economy
Political Geography:
Africa and Ghana

4. Institutional Analysis of Financial Market Fragmentation in Sub-Saharan Africa: A Risk-Cost Configuration Approach

Author:
Machiko Nissanke and Ernest Aryeetey
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper examines the source of financial market fragmentation in sub-Saharan Africa in the framework of institutional economics. Based on fieldwork data from Ghana, Malawi, Nigeria, and Tanzania, it analyses financial risk management, the transaction costs for loan screening and monitoring, and contract enforcement. It shows how, faced with various institutional constraints, the range of clientele selected by formal and informal lenders becomes both narrow and at the extreme market-ends. It evaluates the prevailing state of managing risks for market structure, and binding institutional constraints for market transformation and deepening in sub-Saharan Africa.
Topic:
Development, Economics, and Markets
Political Geography:
Africa, Tanzania, Nigeria, Ghana, and Malawi

5. Financial Sector Development, Savings Mobilization and Poverty Reduction in Ghana

Author:
Peter Quartey
Publication Date:
12-2005
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper primarily investigates the interrelationship between financial sector development and poverty reduction in Ghana. This is done using time-series data from the World Development Indicators from 1970-2001. The main findings are, first, that even though financial sector development does not Granger-cause savings mobilization in Ghana, it induces poverty reduction; and second, that savings do Granger-cause poverty reduction in Ghana. Also, the effect of financial sector development on poverty reduction is positive but insignificant. This is due to the fact that financial intermediaries in Ghana have not adequately channelled savings to the pro-poor sectors of the economy because of government deficit financing, high default rate, lack of collateral and lack of proper business proposals. Another interesting finding is that there is a long-run co integration relationship between financial sector development and poverty reduction.
Topic:
Development, Economics, and Poverty
Political Geography:
Africa and Ghana

6. Tax Reforms in Ghana

Author:
Peter Quartey and Robert Darko Osei
Publication Date:
12-2005
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Ghana's tax reforms constitute the major policy instrument needed to accelerate growth and poverty reduction. Over the past two decades, the government has consistently spent more revenue than it is able to generate and the gap is often financed with foreign aid which has perpetuated the country's aid dependency. Two options can be explored to reduce the gap between government revenue and expenditure; generate more revenue or reduce government expenditure. Although the latter sounds reasonable, the government needs to spend more on key sectors like education, health and infrastructure if the country is to significantly reduce poverty. The critical issue has been how to generate the needed resources domestically, using tax instruments that are least harmful to the poor. This will obviously involve reforming the tax system to ensure efficiency by widening the tax net without necessarily increasing the tax rate. This paper provides an assessment of the changing structure of the tax system in Ghana over the last two decades and suggests ways to improve tax administration in the country.
Topic:
International Relations, Development, and Economics
Political Geography:
Africa and Ghana

7. The Fiscal Effects of Aid in Ghana

Author:
Robert Osei, Oliver Morrissey, and Tim Lloyd
Publication Date:
09-2005
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
An important feature of aid to developing countries is that it is given to the government. As a result, aid should be expected to affect fiscal behaviour, although theory and existing evidence is ambiguous regarding the nature of these effects. This paper applies techniques developed in the 'macroeconometrics' literature to estimate the dynamic linkages between aid and fiscal aggregates. Vector autoregressive methods are applied to 34 years of annual data in Ghana to model the effect of aid on fiscal behaviour. Results suggest that aid to Ghana has been associated with reduced domestic borrowing and increased tax effort, combining to increase public spending. This constructive use of aid to maintain fiscal balance is evident since the mid-1980s, following Ghana's structural adjustment programme. The pa per provides evidence that aid has been associated with improved fiscal performance in Ghana, implying that the aid has been used sensibly (at least in fiscal terms).
Topic:
Development, Economics, and Government
Political Geography:
Africa and Ghana

8. Innovative Ways of Making Aid Effective in Ghana: Tied Aid versus Direct Budgetary Support

Author:
Peter Quartey
Publication Date:
09-2005
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
There has been significant amount of aid inflow s to developing countries including Ghana, but these have been very volatile. Aid flows have been associated with low domestic resource mobilization and have reduced Ghana to a country heavily dependent on aid. The amount of official development assistance (ODA) inflow s has fallen in recent years and has become unpredictable. It is general knowledge that aid has not yielded the desired benefit. In an attempt to improve aid effectiveness donors have used tie d aid not just to promote commercial interests but also to target aid to particular projects that have direct links with poverty. However, this has not yielded the maximum benefits required. Recently, the government of Ghana and its development partners agreed on an aid package dubbed the multi-donor budgetary support (MDBS), which would ensure continuous flow of aid to finance the government's poverty related expenditures.
Topic:
International Relations, Development, and Economics
Political Geography:
Africa and Ghana