Options
Economic Growth Accounting : Policy Analysis of Transitional Dynamics
ISBN
978-1-935056-03-04
Type
conference paper
Date Issued
2009-07-26
Author(s)
Ansah, John P.
Abstract
The GDP growth pattern of Ghana from 1960 to 2000 shows a rollercoaster behavior. Because of this, the Ghanaian population today is almost as poor as it was then. This phenomenon has been studies by several researches all of whom have created important but atomistic insights about this issue. We want to offer a richer explanation. The paper develops an economic growth model to explain the GDP growth pattern in the relevant time frame. We are (1) able to replicate the historical GDP growth, (2) use the model to estimate the contribution of factors of production and labor productivity to economic growth, (3) offer a consistent causal explanation about the growth pattern, and (4) conduct a counterfactual policy analysis offering insights about what could have been possible if different policies would have been executed. In conclusion, the main cause of slow growth in Ghana from 1960-2000 was the declining labor productivity and low physical capital stock. The low physical capital base and lack of innovative production processes of the workforce, is responsible for the poor growth performance. The counterfactual policy analysis puts forth that a policy to encourage investment through increasing propensity to save is most successful.
Language
English
Keywords
simulation modelling
counterfactual policy analysis
economic growth accounting
HSG Classification
contribution to scientific community
Refereed
Yes
Book title
Proceedings of the 27th International System Dynamics Conference
Publisher
Curran Associates, Inc.
Publisher place
Red Hook, USA
Start page
120
End page
157
Pages
38
Event Title
27th International Conference of the System Dynamics Society
Event Location
Albuquerque, New Mexico, U.S.A.
Event Date
26.-30.07.2009
Subject(s)
Division(s)
Eprints ID
53550