This paper reviews the current debate on the state of modern macroeconomics from methodological s... more This paper reviews the current debate on the state of modern macroeconomics from methodological standpoint. While some senior figures in economics have argued that modern macroeconomics has gone wayward and thus become irrelevant for policy, others argue otherwise. Methodologically, the fundamental sources of dispute have centered on realism of assumptions, mathematical formalism and empiricism and falsification of economic models. Our conclusion from this review is that the observable world upon which macroeconomist rely on to make their assumptions, theories and predictions represent a very tiny fraction of physical reality. Thus any policy derived from such partial and short sighted analysis can only produce a sub-optimal outcome. Moreover, the fundamental analysis employed in macroeconomic analysis overlook peculiarities which should be the rule rather than the exception for addressing important economic conundrums. In short, although we do not support the position of most criti...
Http Dx Doi Org 10 1080 15228916 2014 881227, Mar 25, 2014
ABSTRACT The article investigates the extent to which the health of the population affects the ec... more ABSTRACT The article investigates the extent to which the health of the population affects the economic performance using panel data for 30 Sub-Saharan African countries for the period 1970-2010. Using a theoretical model based on an augmented Solow growth model, the authors estimate the relationship between population health capital and economic growth in Sub-Saharan African using panel cointegration econometric strategy. They find that the health status of the population has not significantly driven economic performance. Accounting for the effect of HIV/AIDS, however, resulted in a significant negative effect of population health on economic growth. Furthermore, the obverse seems rather plausibly the case, as economic growth significantly increases life expectancy in the region.
"This paper investigates household cooking energy choices and their determinants... more "This paper investigates household cooking energy choices and their determinants in Ghana using a nationwide household survey data. The underlying empirical model was estimated using the ordered probit model. The results show that biomass is by far the most predominant source of energy for Ghanaian households. Biomass energy is the main source of cooking fuel in Ghana used by 89.2% of households compared with 10.8% which use modern energy sources such as LPG, electricity and kerosene for cooking. The findings of the paper also lend support to the energy ladder hypothesis that household income is a major determinant of household energy choice. Further, social and demographic factors as well as access to energy supplies are key determinants cooking fuel type in Ghana. We thus recommend intensification of income poverty reduction programs to boost households’ incomes. The benefits of such a policy will be to move majority of households towards the upper rungs of the energy ladder. This then implies a move away from over dependence on biomass to clean and modern energy sources such as LPG and electricity. Important component of energy policy will involve measures to remove supply side constraints to ensure regular supply of LPG households. "
This paper applies a local-linear non-parametric kernel regression technique to examine the effec... more This paper applies a local-linear non-parametric kernel regression technique to examine the effect of macroeconomic factors on stock market performance in Ghana. We show that the popular parametric specification in the existing literature suffers from functional misspecification. The evidence suggests that the relationship is non- linear and hence the implied elasticities are non-constant, contrary to findings in the literature. The main finding of the study suggests that stock prices are significantly affected by macroeconomic fundamentals and oil price shocks albeit weakly. This reinforces the need to closely monitor behaviour of macroeconomic indicators while sustaining prudent macroeconomic policy management.
This paper compares the deforestation path taken by profit maximizing agricultural firms in tropi... more This paper compares the deforestation path taken by profit maximizing agricultural firms in tropical regions to the path that will maximize social welfare based on optimal control techniques. We set up a theoretical problem where the socially optimal deforestation path that maximizes the discounted sum of net benefit of forest land use to society diverges from that of a farmer. We arrived at this conclusion after solving for the optimal choice of deforestation for both the private farmer and a social planner. The key source of this divergence in deforestation path is that the cost of deforestation is external to the farmer. The paper concluded that the farmer’s deforestation path leads to socially suboptimal outcome. Fiscal policy measures and public ownerships are recommended to deal with externalities that are inherent in forest land use.
ABSTRACT The article investigates the extent to which the health of the population affects the ec... more ABSTRACT The article investigates the extent to which the health of the population affects the economic performance using panel data for 30 Sub-Saharan African countries for the period 1970-2010. Using a theoretical model based on an augmented Solow growth model, the authors estimate the relationship between population health capital and economic growth in Sub-Saharan African using panel cointegration econometric strategy. They find that the health status of the population has not significantly driven economic performance. Accounting for the effect of HIV/AIDS, however, resulted in a significant negative effect of population health on economic growth. Furthermore, the obverse seems rather plausibly the case, as economic growth significantly increases life expectancy in the region.
This paper reviews the current debate on the state of modern macroeconomics from methodological s... more This paper reviews the current debate on the state of modern macroeconomics from methodological standpoint. While some senior figures in economics have argued that modern macroeconomics has gone wayward and thus become irrelevant for policy, others argue otherwise. Methodologically, the fundamental sources of dispute have centered on realism of assumptions, mathematical formalism and empiricism and falsification of economic models. Our conclusion from this review is that the observable world upon which macroeconomist rely on to make their assumptions, theories and predictions represent a very tiny fraction of physical reality. Thus any policy derived from such partial and short sighted analysis can only produce a sub-optimal outcome. Moreover, the fundamental analysis employed in macroeconomic analysis overlook peculiarities which should be the rule rather than the exception for addressing important economic conundrums. In short, although we do not support the position of most criti...
Http Dx Doi Org 10 1080 15228916 2014 881227, Mar 25, 2014
ABSTRACT The article investigates the extent to which the health of the population affects the ec... more ABSTRACT The article investigates the extent to which the health of the population affects the economic performance using panel data for 30 Sub-Saharan African countries for the period 1970-2010. Using a theoretical model based on an augmented Solow growth model, the authors estimate the relationship between population health capital and economic growth in Sub-Saharan African using panel cointegration econometric strategy. They find that the health status of the population has not significantly driven economic performance. Accounting for the effect of HIV/AIDS, however, resulted in a significant negative effect of population health on economic growth. Furthermore, the obverse seems rather plausibly the case, as economic growth significantly increases life expectancy in the region.
"This paper investigates household cooking energy choices and their determinants... more "This paper investigates household cooking energy choices and their determinants in Ghana using a nationwide household survey data. The underlying empirical model was estimated using the ordered probit model. The results show that biomass is by far the most predominant source of energy for Ghanaian households. Biomass energy is the main source of cooking fuel in Ghana used by 89.2% of households compared with 10.8% which use modern energy sources such as LPG, electricity and kerosene for cooking. The findings of the paper also lend support to the energy ladder hypothesis that household income is a major determinant of household energy choice. Further, social and demographic factors as well as access to energy supplies are key determinants cooking fuel type in Ghana. We thus recommend intensification of income poverty reduction programs to boost households’ incomes. The benefits of such a policy will be to move majority of households towards the upper rungs of the energy ladder. This then implies a move away from over dependence on biomass to clean and modern energy sources such as LPG and electricity. Important component of energy policy will involve measures to remove supply side constraints to ensure regular supply of LPG households. "
This paper applies a local-linear non-parametric kernel regression technique to examine the effec... more This paper applies a local-linear non-parametric kernel regression technique to examine the effect of macroeconomic factors on stock market performance in Ghana. We show that the popular parametric specification in the existing literature suffers from functional misspecification. The evidence suggests that the relationship is non- linear and hence the implied elasticities are non-constant, contrary to findings in the literature. The main finding of the study suggests that stock prices are significantly affected by macroeconomic fundamentals and oil price shocks albeit weakly. This reinforces the need to closely monitor behaviour of macroeconomic indicators while sustaining prudent macroeconomic policy management.
This paper compares the deforestation path taken by profit maximizing agricultural firms in tropi... more This paper compares the deforestation path taken by profit maximizing agricultural firms in tropical regions to the path that will maximize social welfare based on optimal control techniques. We set up a theoretical problem where the socially optimal deforestation path that maximizes the discounted sum of net benefit of forest land use to society diverges from that of a farmer. We arrived at this conclusion after solving for the optimal choice of deforestation for both the private farmer and a social planner. The key source of this divergence in deforestation path is that the cost of deforestation is external to the farmer. The paper concluded that the farmer’s deforestation path leads to socially suboptimal outcome. Fiscal policy measures and public ownerships are recommended to deal with externalities that are inherent in forest land use.
ABSTRACT The article investigates the extent to which the health of the population affects the ec... more ABSTRACT The article investigates the extent to which the health of the population affects the economic performance using panel data for 30 Sub-Saharan African countries for the period 1970-2010. Using a theoretical model based on an augmented Solow growth model, the authors estimate the relationship between population health capital and economic growth in Sub-Saharan African using panel cointegration econometric strategy. They find that the health status of the population has not significantly driven economic performance. Accounting for the effect of HIV/AIDS, however, resulted in a significant negative effect of population health on economic growth. Furthermore, the obverse seems rather plausibly the case, as economic growth significantly increases life expectancy in the region.
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