Browsing by Author "Armah, Stephen Emmanuel"
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ItemDoes political stability improve the aid-growth relationship? A panel evidence on selected Sub-Saharan African countries(Ashesi University College, published by Mot Juste, 2012-12) Armah, Stephen EmmanuelSignificant ambiguity still surrounds the aid-growth relationship despite fifty years of research on the subject. For the case of Sub-Saharan Africa (SSA), a possible reason for the lack of consensus is that until recently the influence of political stability on the aidgrowth relationship had been largely ignored despite its relevance for the region. Further, although overlooked by the literature, the Instrumental Variable (IV) technique, the preferred treatment method of endogeneity in aid-growth relationships, may be ineffective in eliminating endogeneity bias because typical instruments for aid are neither sufficiently exogenous nor strong. Using a dataset of 31 SSA countries from 1984-2007, we re-visit the question of whether aid can spur growth in SSA using firstdifferencing (FD) to eliminate unobserved effect endogeneity while focusing on the role of political stability on the aid-growth relationship in SSA. Results suggest aid promotes growth conditional on political stability in SSA and that First Differencing (FD) eliminates a substantial amount of the endogeneity bias. Our results demonstrate the pertinence of a stable political environment to attaining the UN’s Millennium Development Goals (MDGs) for SSA countries since these goals inherently assume that aid can promote growth. ItemGoing regional: Internationalisation strategies of Ghanaian service companies within the ECOWAS market(Ashesi University College, published by Mot Juste, 2016-07) Seglah, Samuel Kingsford; Armah, Stephen EmmanuelThis paper investigates the internationalisation strategies of Ghanaian service companies within the economic community of West African States (ECOWAS) market. The topic was necessitated by the increasing interest in the study of internationalisation processes of local firms in this era of globalisation, which hitherto was the preserve of multinational enterprises from the developed world. There is very little research on internationalisation processes of firms within the developing economy context as most of the existing literature is biased towards the developed economy context especial in the UK and USA. This paper examines the internationalisation strategies of Ghanaian service companies within the ECOWAS market in order to determine the key strategies adopted by Ghanaian service companies when expanding their operations abroad. The research was based on three case studies of service-oriented firms in Ghana using semi-structured interviews. Data was analysed using cross-case synthesis. Key strategies such as modes of entry of the three companies were analysed. The results of this study validates previous studies such as the Uppsala model which suggests that companies often expand their operations internationally on incremental and gradual fashion, and the eclectic paradigm which contends that three major sets of factors that are interdependent will influence the extent, industrial composition and geography of foreign production undertaken by a firm. Implications are also drawn for service companies, policy makers and researchers. ItemMedia freedom and political stability in Sub-Saharan Africa: a panel data study(Ashesi University College, published by Mot Juste, 2012-12) Armah, Stephen Emmanuel; Amoah, Lloyd GPolitical stability is often cited as a key determinant of growth in Sub-Saharan Africa (SSA) although little research that identifies the factors that ensure political stability in SSA is available. A pertinent determinant of political stability in SSA may be press freedom since on one hand, the press can contribute to political stability by keeping the electorate informed thereby keeping a check on graft, fraud, embezzlement and other corrupt practices of government officials. On the other hand, however, the press can be manipulated to generate political instability by misinforming the public so the exact relationship between press freedom and political stability in SSA is ex ante unclear. By investigating the determinants of political stability and accounting for possible of endogeneity bias, this paper (i) isolates the most pertinent variables that affect political stability in Sub-Saharan Africa and (ii) investigates to what extent press freedom mitigates or worsens the incidence of political instability in the SSA region. A panel of 31 SSA countries from 1984–2007 is used in static and dynamic panel data frameworks to investigate the determinants of political stability and to verify the relationship between media freedom and political stability in SSA. Important determinants of political stability are found to be mainly related to economic performance, macroeconomic policies, unemployment the level of education and regime type. Preliminary results also suggest that media freedom may be a vital determinant of political stability in SSA although less so than economic, political and social factors. Ongoing estimations suggest elasticities of political stability with respect to media freedom calculated at different values of media freedom are nonzero. The research result should help guide policy makers in the different nation states of SSA in drafting pragmatic media and economic policies that will promote political stability in their respective countries. ItemStrategies to stimulate Ghana’s economic transformation and diversification(Ashesi University College, published by Mot Juste, 2016-07) Armah, Stephen EmmanuelAfter metamorphosing into a lower middle income country, Ghana needs to transform and diversify its economy if it is to consolidate its lower middle income status, reach upper middle income status and drag more of its people out of poverty. Pertinent questions that remain unanswered include: what are the principal self-imposed problems Ghana needs to resolve; what are the institutional changes Ghana needs to make to transform and diversify its economy and what lessons can Ghana glean out of the experiences of other countries that have transformed their economies? Using a comparative analysis of published research and economic analyses, based on the available literature, this paper provides some answers to these questions. Key self-imposed problems include: weak institutions highlighted by a ‘winner takes all’ democratic governance structure that disenfranchises Ghanaians with no connections to the ruling party; weak management of the macro-economy; extremely high cost of borrowing; an unstable exchange rate; high import taxes; a narrow tax bracket with the majority in the informal sector paying zero taxes reducing government revenue; endemic corruption; ineffective land tenure; an inadequate transportation network; unreliable access to electric power; inability to engage in manufacturing; poor sanitation; difficulties in curtailing illegal mining and widespread indiscipline that makes management of people unduly challenging. Critical institutional reform needed includes a constitutional review that limits the power of the executive and makes him accountable for his actions. The number of appointments that the executive has to make to technical and professional leadership positions in the public service and production sectors must also be reduced. The status quo forces the President to make appointments to leadership positions in which he has no experience and confounds the political and economic lives of Ghanaians. Public institutions must be rid of political influence to purge them of political sycophancy, improve the technical capabilities of their leadership and increase their effectiveness. Ghana also needs to get aggressive about limiting avenues for corruption. This can be achieved by eliminating the loopholes and conflict of interest inherent in the constitution that allows corrupt practices to go unpunished especially on the grounds of technicalities: an independent corruption prosecution agency is essential in this regard. The rule of law must be strengthened – particularly in the rural areas and inner cities – and progressive land reform must be carried out. The current situation where fertile southern agricultural land is being co-opted for real estate must be halted to reduce the twin risks of food inflation and food insecurity in the future. A real effort must also be made to break through long-held and negative socialist and traditional views about private ownership so property rights can be properly acknowledged and enforced. ItemWill hedging joint cocoa price and production risk benefit Ghana?(Ashesi University College, published by Mot Juste, 2012-12) Armah, Stephen EmmanuelThis paper assesses the usefulness of risk hedging on futures markets for a cocoa exporter subject to concurrent price and output (revenue) risks. The analysis is conducted for Ghana, the world’s second largest exporter of cocoa beans. Using cocoa export revenue data, the cocoa exporter’s utility maximization problem (UMP) is solved using a Constant Relative Risk Aversion (CRRA) utility function due to Nelson and Escalante (2004) which displays risk vulnerability. Risk vulnerability is the most natural restriction on preferences (Gollier and Pratt, 1996). Simulation results from solving the UMP indicate that as a result of production risk, optimal revenue hedge ratios are much smaller than optimal price risk hedge ratios for reasonable values of the risk parameter. When transaction costs are incorporated into the hedger’s UMP , optimal revenue hedge ratios decline further although they remain positive. The findings indicate that limited use of the futures market is optimal for Ghana because it improves cocoa exporter utility relative to the unhedged position. These results should provide valuable information to policy makers in Ghana and other cocoa producing countries because they confirm that revenue risk hedging is a viable risk management alternative even when transaction costs are accounted for in the UMP of the hedger.