IDEAS home Printed from https://ideas.repec.org/p/fpr/ifprid/1161.html
   My bibliography  Save this paper

Economic transformation in Ghana: Where will the path lead?

Author

Listed:
  • Kolavalli, Shashi
  • Robinson, Elizabeth J. Z.
  • Diao, Xinshen
  • Alpuerto, Vida
  • Folledo, Renato
  • Slavova, Mira
  • Ngeleza, Guyslain K.
  • Asante, Felix Ankomah

Abstract

In the context of the Ghanaian government’s objective of structural transformation with an emphasis on manufacturing, this paper provides a case study of economic transformation in Ghana, exploring patterns of growth, sectoral transformation, and agglomeration. We document and examine why, despite impressive growth and poverty reduction figures, Ghana’s economy has exhibited less transformation than might be expected for a country that has recently achieved middle-income status. Ghana’s reduced share of agriculture in the economy, unlike many successfully transformed countries in Asia and Latin America, has been filled by services, while manufacturing has stagnated and even declined. Likely causes include weak transformation of the agricultural sector and therefore little development of agroprocessing, the emergence of consumption cities and consumption-driven growth, upward pressure on the exchange rate, weak production linkages, and a poor environment for private-sector-led manufacturing.

Suggested Citation

  • Kolavalli, Shashi & Robinson, Elizabeth J. Z. & Diao, Xinshen & Alpuerto, Vida & Folledo, Renato & Slavova, Mira & Ngeleza, Guyslain K. & Asante, Felix Ankomah, 2012. "Economic transformation in Ghana: Where will the path lead?," IFPRI discussion papers 1161, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:ifprid:1161
    as

    Download full text from publisher

    File URL: http://www.ifpri.org/sites/default/files/publications/ifpridp01161.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Gustavo Anríquez & Silvio Daidone, 2010. "Linkages between the farm and nonfarm sectors at the household level in rural Ghana: a consistent stochastic distance function approach," Agricultural Economics, International Association of Agricultural Economists, vol. 41(1), pages 51-66, January.
    2. Canagarajah, S. & Newman, C. & Bhattamishra, R., 2001. "Non-farm income, gender, and inequality: evidence from rural Ghana and Uganda," Food Policy, Elsevier, vol. 26(4), pages 405-420, August.
    3. Breisinger, Clemens & Diao, Xinshen & Kolavalli, Shashidhara & Al Hassan, Ramatu & Thurlow, James, 2011. "A new era of transformation in Ghana: Lessons from the past and scenarios for the future," Research reports 978-0-89629-788-3, International Food Policy Research Institute (IFPRI).
    4. Geeta Kingdon & Justin Sandefur & Francis Teal, 2006. "Labour Market Flexibility, Wages and Incomes in Sub‐Saharan Africa in the 1990s," African Development Review, African Development Bank, vol. 18(3), pages 392-427.
    5. Clemens Breisinger & Xinshen Diao & James Thurlow & Ramatu M. Al Hassan, 2011. "Potential impacts of a green revolution in Africa—the case of Ghana," Journal of International Development, John Wiley & Sons, Ltd., vol. 23(1), pages 82-102, January.
    6. repec:fpr:resrep:clemensbreisinger is not listed on IDEAS
    7. Derek Headey & Dirk Bezemer & Peter B. Hazell, 2010. "Agricultural Employment Trends in Asia and Africa: Too Fast or Too Slow?," The World Bank Research Observer, World Bank, vol. 25(1), pages 57-89, February.
    8. repec:ilo:ilowps:397933 is not listed on IDEAS
    9. Francis Teal, 1999. "Why Can Mauritius Export Manufactures and Ghana Not?," The World Economy, Wiley Blackwell, vol. 22(7), pages 981-993, September.
    10. Justin Sandefur, 2010. "On the Evolution of the Firm Size Distribution in an African Economy," CSAE Working Paper Series 2010-05, Centre for the Study of African Economies, University of Oxford.
    11. Delgado, Christopher L. & Hopkins, Jane & Kelly , Valerie & Hazell, P. B. R. & McKenna, Anna A. & Gruhn, Peter & Hojjati, Behjat & Sil, Jayashree & Courbois, Claude, 1998. "Agricultural growth linkages in Sub-Saharan Africa:," Research reports 107, International Food Policy Research Institute (IFPRI).
    12. Uchida, Hirotsugu & Nelson, Andrew, 2010. "Agglomeration Index Towards a New Measure of Urban Concentration," WIDER Working Paper Series 029, World Institute for Development Economic Research (UNU-WIDER).
    13. Yusof, Zainal Aznam, 2010. "Economic growth in Malaysia: some possible lessons for Ghana," LSE Research Online Documents on Economics 36388, London School of Economics and Political Science, LSE Library.
    14. Paul Collier & Jan Willem Gunning, 1999. "Why Has Africa Grown Slowly?," Journal of Economic Perspectives, American Economic Association, vol. 13(3), pages 3-22, Summer.
    15. Robinson, Elizabeth J. Z. & Kolavalli, Shashi L., 2010. "The case of tomato in Ghana: Processing," GSSP working papers 21, International Food Policy Research Institute (IFPRI).
    16. Breisinger, Clemens & Diao, Xinshen, 2008. "Economic transformation in theory and practice: What are the messages for Africa?," IFPRI discussion papers 797, International Food Policy Research Institute (IFPRI).
    17. Breisinger, Clemens & Diao, Xinshen & Thurlow, James & Yu, Bingxin & Kolavalli, Shashi L., 2007. "Accelerated growth and structural transformation: Assessing Ghana’s options to reach middle-income status," GSSP working papers 7, International Food Policy Research Institute (IFPRI).
    18. Aryeetey, Ernest. & Baah-Boateng, W., 2007. "Growth, investment and employment in Ghana," ILO Working Papers 993979333402676, International Labour Organization.
    19. Clemens Breisinger & Xinshen Diao & Rainer Schweickert & Manfred Wiebelt, 2010. "Managing Future Oil Revenues in Ghana: An Assessment of Alternative Allocation Options," African Development Review, African Development Bank, vol. 22(2), pages 303-315.
    20. Fabian Barthel & Matthias Busse & Robert Osei, 2011. "The Characteristics and Determinants of FDI in Ghana," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 23(3), pages 389-408, July.
    21. Akramov, Kamiljon T. & Asante, Felix Ankomah, 2008. "Decentralization and local public services in Ghana: Do geography and ethnic diversity matter?," GSSP working papers 16, International Food Policy Research Institute (IFPRI).
    22. Charles Ackah & Denis Medvedev, 2012. "Internal migration in Ghana: determinants and welfare impacts," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 39(10), pages 764-784, August.
    23. Francis Teal, 1999. "Why can Mauritius export manufactures and Ghana not?," Economics Series Working Papers WPS/1999-10, University of Oxford, Department of Economics.
    24. Melo, Patricia C. & Graham, Daniel J. & Noland, Robert B., 2009. "A meta-analysis of estimates of urban agglomeration economies," Regional Science and Urban Economics, Elsevier, vol. 39(3), pages 332-342, May.
    25. Francis Teal & Nicholas Nsowah-Nuamah and Moses Awoonor-Williams, 2010. "Jobs, Skills and Incomes in Ghana: How was poverty halved?," Economics Series Working Papers CSAE WPS/2010-01, University of Oxford, Department of Economics.
    26. Nicholas Nsowah-Nuamah & Francis Teal & Moses Awoonor-Williams, 2010. "Jobs, Skills and Incomes in Ghana: How was poverty halved?," CSAE Working Paper Series 2010-01, Centre for the Study of African Economies, University of Oxford.
    27. Hirotsugu Uchida & Andrew Nelson, 2010. "Agglomeration Index: Towards a New Measure of Urban Concentration," WIDER Working Paper Series wp-2010-029, World Institute for Development Economic Research (UNU-WIDER).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Diao, Xinshen & Cossar, Frances & Houssou, Nazaire & Kolavalli, Shashidhara & Jimah, Kipo & Aboagye, Patrick, 2012. "Mechanization in Ghana: Searching for sustainable service supply models:," IFPRI discussion papers 1237, International Food Policy Research Institute (IFPRI).
    2. M. Ali Nasrun & Fariastuti & Sukma Indra, 2020. "The Role of Agricultural Sector in Explaining Poverty in Indonesia: A Study Case of West Kalimantan," International Journal of Economics and Financial Issues, Econjournals, vol. 10(5), pages 297-303.
    3. Holli Capps Herron & Peter Waylen & Kwadwo Owusu, 2023. "Spatial and temporal variability in the characteristics of extreme daily rainfalls in Ghana," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 117(1), pages 655-680, May.
    4. De Pinto, Alessandro & Demirag, Ulaç & Haruna, Akiko & Koo, Jawoo & Asamoah, Marian, 2012. "Climate change, agriculture, and foodcrop production in Ghana," GSSP policy notes 3, International Food Policy Research Institute (IFPRI).
    5. Enoch Bessah & Emmanuel A. Boakye & Sampson K. Agodzo & Emmanuel Nyadzi & Isaac Larbi & Alfred Awotwi, 2021. "Increased seasonal rainfall in the twenty-first century over Ghana and its potential implications for agriculture productivity," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(8), pages 12342-12365, August.
    6. Albert Danso & Samuel Adomako & Joseph Amankwah‐Amoah & Samuel Owusu‐Agyei & Renata Konadu, 2019. "Environmental sustainability orientation, competitive strategy and financial performance," Business Strategy and the Environment, Wiley Blackwell, vol. 28(5), pages 885-895, July.
    7. Frances Warren, 2023. "Population density, urbanisation and agricultural mechanisation in modern Ghana," Review of Development Economics, Wiley Blackwell, vol. 27(3), pages 1605-1629, August.
    8. Diao, Xinshen & Cossar, Frances & Houssou, Nazaire & Kolavalli, Shashidhara, 2014. "Mechanization in Ghana: Emerging demand, and the search for alternative supply models," Food Policy, Elsevier, vol. 48(C), pages 168-181.
    9. van Paassen, A. & Osei-Amponsah, Charity & Klerkx, L. & van Mierlo, B. & Essegbey, G. O., 2022. "Partnerships blending institutional logics for inclusive global and regional food value chains in Ghana; with what smallholder effect?," Papers published in Journals (Open Access), International Water Management Institute, pages 1-25.().
    10. Chapoto, Antony & Mabiso, Athur & Bonsu, Adwinmea, 2013. "Agricultural commercialization, land expansion, and homegrown land-scale farmers: Insights from Ghana:," IFPRI discussion papers 1286, International Food Policy Research Institute (IFPRI).
    11. Annemarie Paassen & Charity Osei-Amponsah & Laurens Klerkx & Barbara Mierlo & George Owusu Essegbey, 2022. "Partnerships Blending Institutional Logics for Inclusive Global and Regional Food Value Chains in Ghana; with What Smallholder Effect?," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(5), pages 2179-2203, October.
    12. Houssou, Nazaire & Kolavalli, Shashidhara & Silver, Jed, 2016. "Agricultural intensification, technology adoption, and institutions in Ghana," GSSP policy notes 10, International Food Policy Research Institute (IFPRI).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Glass, Anthony J. & Kenjegalieva, Karligash & Ajayi, Victor & Adetutu, Morakinyo & Sickles, Robin C., 2016. "Relative Winners and Losers from Efficiency Spillovers in Africa with Policy Implications for Regional Integration," Working Papers 16-003, Rice University, Department of Economics.
    2. Andrew Kerr & Martin Wittenberg & Jairo Arrow, 2014. "Job Creation and Destruction in South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 82(1), pages 1-18, March.
    3. Fujii, Hidemichi & Iwata, Kazuyuki & Chapman, Andrew & Kagawa, Shigemi & Managi, Shunsuke, 2018. "An analysis of urban environmental Kuznets curve of CO2 emissions: Empirical analysis of 276 global metropolitan areas," Applied Energy, Elsevier, vol. 228(C), pages 1561-1568.
    4. Bigerna, Simona & D'Errico, Maria Chiara & Polinori, Paolo, 2022. "Understanding the green-growth: which pathways cities undertake in their climate programs," MPRA Paper 114156, University Library of Munich, Germany.
    5. Maswana, Jean-Claude, 2006. "Economic Development Patterns and Outcomes in Africa and Asia," MPRA Paper 5551, University Library of Munich, Germany.
    6. Francis Teal, 2010. "Higher Education and Economic Development in Africa: a Review of Channels and Interactions," CSAE Working Paper Series 2010-25, Centre for the Study of African Economies, University of Oxford.
    7. Francis Teal, 2010. "Higher Education and Economic Development in Africa: a Review of Channels and Interactions," Economics Series Working Papers CSAE WPS/2010-25, University of Oxford, Department of Economics.
    8. Paul Mosley, 2013. "Two Africas? Why Africa’s ‘Growth Miracle’ is barely reducing poverty," Global Development Institute Working Paper Series 19113, GDI, The University of Manchester.
    9. repec:ldr:wpaper:92 is not listed on IDEAS
    10. Jun Hou & Xiaolan Fu & Pierre Mohnen, 2022. "The Impact of China–Africa Trade on the Productivity of African Firms: Evidence from Ghana," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(2), pages 869-896, April.
    11. Florian Léon, 2022. "The elusive quest for high-growth firms in Africa: when other metrics of performance say nothing," Small Business Economics, Springer, vol. 58(1), pages 225-246, January.
    12. Manfred Wiebelt & Rainer Schweickert & Clemens Breisinger & Marcus Böhme, 2011. "Oil revenues for public investment in Africa: targeting urban or rural areas?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(4), pages 745-770, November.
    13. Paul Mosley, 2011. "RETRACTED ARTICLE: Trust and conditionality; Or, can the World Bank ‘Leopard’ change its spots?," The Review of International Organizations, Springer, vol. 6(3), pages 483-483, September.
    14. Sean Fox & Robin Bloch & Jose Monroy, 2018. "Understanding the dynamics of Nigeria’s urban transition: A refutation of the ‘stalled urbanisation’ hypothesis," Urban Studies, Urban Studies Journal Limited, vol. 55(5), pages 947-964, April.
    15. Tandel, Vaidehi & Hiranandani, Komal & Kapoor, Mudit, 2019. "What’s in a definition? A study on the suitability of the current urban definition in India through its employment guarantee programme," Journal of Asian Economics, Elsevier, vol. 60(C), pages 69-84.
    16. Paul Kwame Nkegbe & Abdelkrim Araar & Benjamin Musah Abu & Hamdiyah Alhassan & Yazidu Ustarz & Edinam Dope Setsoafia & Shamsia Abdul-Wahab, 2022. "Nonfarm activity and market participation by farmers in Ghana," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 10(1), pages 1-23, December.
    17. Breisinger, Clemens & Diao, Xinshen & Wiebelt, Manfred, 2014. "Can oil-led growth and structural change go hand in hand in Ghana?," Journal of Policy Modeling, Elsevier, vol. 36(3), pages 507-523.
    18. W. A. Naudé, 2004. "The effects of policy, institutions and geography on economic growth in Africa: an econometric study based on cross-section and panel data," Journal of International Development, John Wiley & Sons, Ltd., vol. 16(6), pages 821-849.
    19. Tomoo Kikuchi & Kazuo Nishimura & John Stachurski, 2012. "Coase meets Tarski: New Insights from Coase's Theory of the Firm," KIER Working Papers 828, Kyoto University, Institute of Economic Research.
    20. Andam, Kwaw & Silver, Jed, 2016. "Food processing in Ghana: Trends, constraints, and opportunities," GSSP policy notes 11, International Food Policy Research Institute (IFPRI).

    More about this item

    Keywords

    economic growth; Economic transformation; agricultural sector; Private sector;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fpr:ifprid:1161. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/ifprius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.