Modelling The Impact Of Political Stability On Cocoa Production

Abstract

Economic growth and political stability are genuinely interrelated. In Ghana, the Cocoa Production Sector is one of the main boosters of the GDP. This paper used political stability as major intervention on the cocoa production. It sought to estimate and assess the impact of Political Stability as a variation on Cocoa Production in Ghana using Bia and Tiao, intervention analysis model. Time series data on cocoa productions from the department of Monitoring, Research and Evaluation of Ghana COCOBOD spanning from the year 1968 to 2016 was used. The Empirical result indicates that, the pre- intervention period was modeled with ARIMAX process based on which the full intervention model was obtained. The intervention event exists but it has an insignificant impact on cocoa production. The Ljung- Box test and its residual plots were significant. It concluded that the insignificant of political stability on cocoa production means that there is no influence of political appointees on the cocoa production. The study recommends that, the cocoa production sector should be independent of political interference since it’s the back bone of Ghana’s GDP.