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What is the Effect of Economic Globalisation on the Productivity of the Manufacturing Sector of Ghana?

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  • Yeboah Asuamah, Samuel
  • Broni Pinkrah, Samuel
  • Quansah Abbey, Paul

Abstract

The research paper investigates the stable long run hypothesis between globalisation and manufacturing sector productivity for Ghana for the period 1961-2013 using annual time series data. The augmented Dickey Fuller (ADF, for unit root analysis) and Kwiatkowski–Phillips–Schmidt–Shin (KPSS, unit root analysis), OLS (regression analysis), Johansen test (long run analysis), VECM (short run analysis), and the granger causality (causality analysis) tests were used. The findings suggest the data were integrated of order one. The findings of the study seem to indicate that the manufacturing sector has not benefited from globalisation. There is the need to introduce various policy measures such as improvement in security to reduce risk and uncertainty of foreign investment into the manufacturing sector; improvement in infrastructure to encourage domestic and foreign investment into the manufacturing sector; and strong political will to attract investors into the sector. Further studies should consider the effect of other factors (electricity) and other proxies of globalisation (foreign direct investment, financial liberalisation, investment liberalisation, and multinational firm activity) on the manufacturing sector performance to determine if the findings will be replicated. The issues of structural breaks should be investigated in future studies.

Suggested Citation

  • Yeboah Asuamah, Samuel & Broni Pinkrah, Samuel & Quansah Abbey, Paul, 2016. "What is the Effect of Economic Globalisation on the Productivity of the Manufacturing Sector of Ghana?," MPRA Paper 71379, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:71379
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    File URL: https://mpra.ub.uni-muenchen.de/71379/1/MPRA_paper_71379.pdf
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    References listed on IDEAS

    as
    1. Kwiatkowski, Denis & Phillips, Peter C. B. & Schmidt, Peter & Shin, Yongcheol, 1992. "Testing the null hypothesis of stationarity against the alternative of a unit root : How sure are we that economic time series have a unit root?," Journal of Econometrics, Elsevier, vol. 54(1-3), pages 159-178.
    2. Magnus Blomström & Ari Kokko & Mario Zejan, 2000. "Technology, Market Characteristics and Spillovers," Palgrave Macmillan Books, in: Foreign Direct Investment, chapter 10, pages 160-176, Palgrave Macmillan.
    3. James R. Tybout, 2000. "Manufacturing Firms in Developing Countries: How Well Do They Do, and Why?," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 11-44, March.
    4. Godwin Ukaiji Okpokpo & Innocent Abanum Ifelunini & Fidelis Osuyali, 2014. "Is Globalisation A Potent Driver of Economic Growth? Investigating the Nigerian Non-Oil Exports," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 4(6), pages 781-792.
    5. Pedro Reyes & Mahesh S. Raisinghani & Manoj Singh, 2002. "Global Supply Chain Management in the Telecommunications Industry: The Role of Information Technology in Integration of Supply Chain Entities," Journal of Global Information Technology Management, Taylor & Francis Journals, vol. 5(2), pages 48-67, April.
    6. Roy Mclean, 2001. "Globalization and the Asian financial crisis," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 29(4), pages 471-471, December.
    7. Granger, Clive W J, 1986. "Developments in the Study of Cointegrated Economic Variables," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 48(3), pages 213-228, August.
    8. Godwin Ukaiji Okpokpo & Innocent Abanum Ifelunini & Fidelis Osuyali, 2014. "Is Globalisation A Potent Driver of Economic Growth? Investigating the Nigerian Non-Oil Exports," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 4(6), pages 781-792, June.
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    Cited by:

    1. Odebode, Adedapo & Aras, Osman Nuri, 2019. "The Impact of Globalization on Manufacturing Output: The Case of Nigeria," MPRA Paper 108359, University Library of Munich, Germany.

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    More about this item

    Keywords

    Manufacturing Sector; Trade Openness; Globalisation; Long Run;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L6 - Industrial Organization - - Industry Studies: Manufacturing

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