The impact of culture and government policies on Ghana's economic development

Abstract

Ghana had a promising start as one of the most successful countries in Africa when it achieved independence in 1957. However, the economy then suffered from stagnant growth until it embarked on an Economic Reform Program in 1983. After coming to power in 2001, the current government declared Ghana a 'Highly Indebted Poor Country' (HIPC) and developed a Poverty Reduction Strategy aiming at halving extreme poverty by 2010 and achieving middle income status by 2015. In this context, it is the study's main aim to identify key 'actionable factors' for accelerating Ghana's economic development. An extensive review and analysis of relevant literature and socio-economic data regarding culture, government policies and economic development, provides a wider view of the relevant areas and concepts for the development of the conceptual framework of this study. Ghana has attracted the attention of the world's development economists. Little attention, however, has been paid to the impact of national culture on economic development. The literature review in this context indicates a lack of systematic and empirically tested studies. This research employs a pragmatist approach involving quantitative and qualitative research (mixed-methods) in order to identify the dominant cultural values and their role in economic development. The collection of primary data involved surveys and in-depth interviews in three areas chosen to provide clear contrasts of relevant variables. The survey and interview data were analysed using SPSS and N-Vivo packages for their respective statistical and qualitative analyses. The study's findings confirm and extend Hofstede's work on the regional or ethnic level. These have been correlated with available regional statistics for validation and for establishing the link between culture, institutions and economic development. The interview findings corroborate and triangulate the survey and provide insights into the interpretation of findings for culturally sensitive economic policies. The research concludes that economic development cannot be achieved by focusing on economics alone and that socio-cultural factors are important in determining the outcome of development efforts. Furthermore, the research has also shown how the studies in development economics can be adapted by including socio-cultural factors to enhance its usefulness to developing countries