Browsing by Author "Gockel, A.F."
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Item An Empirical Investigation of Per Capita Income Convergence Hypothesis in Sub-Saharan Africa(University of Ghana, 2013-06) Aboagye, S.; Gockel, A.F.; Turkson, F.E.The incidence of cross-country per capita income convergence has been debated for long by economists; all in the attempt to either validate or reject the per capita income convergence hypothesis as predicted by the Human capital - augmented Solow model (HC-ASM). However, researchers seem to have given little attention to Sub-Saharan African (SSA) in this ongoing discourse despite the wide per capita income disparity gap in the region. This present study fills this gap by conducting an empirical investigation of per capita income convergence hypothesis in SSA based on the strict assumption of a closed economy without government activities of the HC-ASM. The hypothesis is further tested by relaxing these restrictive assumptions specifically, by including into the basic model, government spending, FDI and openness to trade. Using panel dataset on 37 SSA countries selected mainly on the basis of data availability, the study examined the convergence hypothesis employing panel Generalized Least Squares from 1980 to 2010. The study established per capita income divergence among the countries in SSA, with the level of divergence increasing with the inclusion of FDI, trade openness and government spending into the basic model. These findings are in complete disagreement with the prediction of the HC-ASM and further suggest that regardless of the presence of FDI, trade openness and government spending per capita income disparity gap among countries in SSA tends to widen. Against these findings, it is recommended that poorer countries in SSA should urgently make pragmatic policies to attract FDI and make efficient utilization of these resources to reduce the per capita income gap since FDI was found to positively impact on per capita income growth in SSA.Item Explaining the market power of Ghanaian banks(South African Journal of Economics, 2009-02) Aboagye, Q.Q.A.; Akoena, S.K.; Antwi-Asare, T.O.; Gockel, A.F.A competitive banking system helps lower transaction costs and risks. It also helps make financial markets more efficient. In Ghana however, observers believe that the banking industry is not competitive and point to the huge spread between bank lending and borrowing rates as evidence. The Ghanaian banking industry is analysed for evidence of market power by computing the Lerner Index of banks using quarterly data from 2001 to 2006. The evidence is that Ghanaian banks possess market power. Factors that significantly explain the market power of Ghanaian banks are: bank size, efficiency of banks with respect to staff costs, the macroeconomic environment and time. © Journal compilation © 2008 The Economic Society of South Africa.Item Feasibility Study of a Single Currency for West African Monetary Zone(University of Ghana, 2013-06) Amoah, D.; Gockel, A.F.; Akoena, S.K.K.The formation of a Monetary Union by the West African Monetary Zone has been in pursuance for more than a decade. The WAMZ is made up of six countries in West Africa; The Gambia, Ghana, Guinea, Liberia, Nigeria and Sierra Leone. One significant benefit from using a common currency is the lower costs of transactions; however member countries will lose the ability to use monetary policy to respond to different shocks. The participating countries need to converge or ultimately attain an Optimum Currency Area to mitigate the asymmetric shocks. The WAMZ has a set of Macroeconomics Convergence Criteria to be attained by its member countries before the commencement of the Monetary Union. The study assesses the performance of all the WAMZ countries based on the MCC from 2001 to 2011. The study also uses various theoretical criteria to assess the Optimum Currency Area in the WAMZ. The study further employs the exchange rate variability based on the OCA index to analyze the possibility of currency integration among three of the WAMZ’s countries consisting of The Gambia, Ghana and Nigeria using time series data from 1980 to 2011. The assessment based on the MCC indicates that WAMZ is not ready to form the Monetary Union as of 2011. However, there are some convergences in the primary MCC. The results from the study also indicate that the WAMZ is not an Optimum Currency Area. The OCA index results show that the Nigerian Naira was the most stable currency in the region during the period of analysis. Furthermore, the method confirms that the WAMZ single currency (if it will be established) should start with Nigeria and Ghana, followed by The Gambia.Item Financial Deepening, Trade Openness, and Economic Growth in West Africa(University of Ghana, 2013-12) Iyke, B.N.; Gockel, A.F.; Antwi-Asare, T.O.The dilemma concerning the choice between austerity and stimulus packages has reignited the finance-growth debate. This study joins the debate to examine the linkages between financial deepening, trade openness and economic growth in selected West African countries. The study looks at the two monetary zones in West Africa, namely the West African Monetary Zone (WAMZ) and West African Economic and Monetary Union (WAEMU). Using a panel data of twelve (12) countries covering 1992—2009 period, the study finds that financial depth, trade openness and economic growth are non- stationary in both WAMZ and WAEMU. This means that the variables cannot be used for policy forecasting, when in their levels. The study also finds that all three variables are not cointegrated in WAMZ and WAEMU; hence, no panel error correction model was required for the causality tests. Finally, the study performs the Granger Panel Causality Test in a trivariate VAR and found that causality runs from financial deepening to economic growth through trade openness for countries of both WAMZ and WAEMU. The study concludes that financial deepening produces positive economic growth. However, this was possible if the trade sector was liberalised to allow global participation in the local markets. It recommends suitable policies that enhance both financial sector and trade sector development, such as the existence of a strong common currency, the liberalisation of interest rates, the reduction in government interference (in both the trade and financial sectors), improved bilateral and multilateral trade agreement which benefits all parties. The study predicts favourable economic growth in both WAMZ and WAEMU when these policies are put in place.Item Inflation Targeting: The Ghanaian Experience(University of Ghana, 2015-07) Fosu, N.K.; Gockel, A.F.; Barimah, A.; University of Ghana, College of Humanities, School of Social Sciences,Department of EconomicsInflation Targeting as a monetary policy has been adopted widely by many countries both developed and developing. The Bank of Ghana, adopted Inflation Targeting in 2002 but made an official announcement of its use in 2007, making Ghana the second country to adopt Inflation Targeting in Africa after South Africa. This study sought to determine the effects of Inflation Targeting on the Inflation Rate, Economic Growth, the Exchange Rate and the growth in Money Supply of Ghana. The study adopted the quantitative method in the analysis of the data. Secondary data was used in this work. The study compared the effects of Inflation Targeting on the given macroeconomic variables by dividing the thirty year period (1984-2013) into an eighteen year pre inflation targeting period (1984-2001) and a twelve year post inflation targeting period (2002-2013). The results showed a difference in the various macroeconomic variables between the pre and the post inflation targeting eras. The results, also showed a significant decline in the rate of inflation in Ghana after the adoption of Inflation Targeting. There was also a significant improvement in the level of economic growth after the implementation of Inflation Targeting. The exchange rate situation of Ghana has however worsened since the implementation of Inflation Targeting, though this is not statistically significant. There was also a fall in the growth of money supply in Ghana though this was also not statistically significant. The study concluded that Inflation Targeting should be continued and not truncated since it has shown a fall in the rate of inflation. Higher goals also need to be set to attain higher performances in the country’s macroeconomic variables as other countries are doing. More studies also need to be conducted in this area with other macroeconomic variables.Item Market Shares and Profitability of Universal Banks in Ghana(University of Ghana, 2015-07) Amo, O.; Gockel, A.F.; Osei-Assibey, E.; University of Ghana, College of Humanities, School of Social Sciences, Department of EconomicsThe increasing competition among banks in Ghana is largely explained by the liberalisation and implementation of the various financial sector reforms recommended by the International Monetary Fund (IMF) and the World Bank. In today’s competitive world, one of the challenges facing many managers in the banking sector is how to increase business market shares and profits concurrently. Although the correlation between market shares and profitability has been sustained over the years, it remains a generalisation which has been over-extended without its attributes acknowledged. The question frequently asked is whether higher market share leads to higher profits? The study therefore seeks to analyse the factors that influence bank’s market share and also to examine the relationship between market share and profitability of universal banks in Ghana. A panel data of 15 universal banks in Ghana are analysed over a period of 2004 to 2013 using the Generalised Method of Moment (GMM) and random effect regression models. Results from the study indicate that, bank size, operating efficiency, bank age, number of branches, ownership structure, Gross Domestic Product and inflation significantly determine market share. The study also reveals that, there is no significant relationship between market share and profitability. The study recommends that, banks employ more technologies to facilitate their service delivery and ensure the efficient management of bank operations to help alleviate the high operational cost that erodes bank profits. Also, management need to understand the context of their environment before adoption of market share strategy.Item Simulating the Impact of the Global Economic Crisis and Policy Responses on Children in Ghana. Country Report(Innocenti, Florence, Italy, 2010) Akoena, S.K.; Aboagye, A.Q.Q.; Antwi-Asare, T.O.; Gockel, A.F.; Hester, S.