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Research article - Peer-reviewed, 2011

Determinants of inflation in Ghana: an empirial investigation

Adu, George; Marbuah, George


This paper provides an empirical analysis of the factors accounting for inflation dynamics in Ghana using the bounds test and other econometric approaches.We find that real output, nominal exchange rate, broad money supply, nominal interest rate and fiscal deficit play a dominant role in the inflationary process in Ghana. To the extent that output growth by far has the strongest impact on inflation, targeting supply-side constraints will help moderate price inflation. The paper concludes that inflation in Ghana is explained by a combination of structural and monetary factors consistent with prior studies


Inflation; unit root; fiscal deficit; ARDL; Ghana

Published in

South African Journal of Economics
2011, Volume: 79, number: 3, pages: 251-269

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    • UKÄ Subject classification

      Social Sciences
      Economics and Business

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