External aid inflows and the real exchange rate in Ghana
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Date
2001-11-01
Authors
Harry A. Sackey
Journal Title
Journal ISSN
Volume Title
Publisher
AERC
Abstract
This paper develops an empirical model for Ghana’s real exchange rate with special
focus on foreign aid. The novelty of this study is the interfacing of exports with a policy
environment, using aid as proxy, to see how it affects export performance. The paper
finds that although aid dependence is quite high, aid inflows lead to depreciations in the
real exchange rate. Aid inflows have also had a positive impact on export performance.
The paper concludes that for external aid to be an effective investment, policy management
needs to focus on ensuring the prevalence of sound macroeconomic fundamentals, among
others.
Description
HC 1060 . S23 2001
Keywords
Economic Assistance - Ghana