An estimation of the impact of energy production on economic growth in ghana

Abstract

The main aim of this study was to determine the impact of energy production on economic growth in Ghana. The Ordinary least squares method of estimation was used to determine the values of the respective parameter estimates. The study identified that Ghana is still a developing country that needs enough energy supply to expand to become an industrialized economy. Also, the study revealed that there is a positive relationship between electricity production and economic growth despite the unstable nature of electric power supply in Ghana. The value of the impact is 0.0500175. That is, the degree of the responsiveness is 0.0500175 meaning an inelastic effect. This implies that electricity production is an input of necessity to or key to Ghana’s economic expansion and sustainability development though statistically insignificant. Therefore, the policy suggestion is that the government should continue to invest massively into energy sector of the Ghanaian economy to ensure consistent and sustainable supply of energy to the industrial, commercial and residential units of the economy in order to achieve significant impact on the overall economic growth and development of Ghana.