Analysis of the Agricultural Sector of Ghana and Its Economic Impact on Economic Growth

Abstract

The research seeks to determine the impact of the agricultural sector on Ghana’s economic growth and the effect of the various sub- sectors of the agricultural sectors on Ghana’s economic growth. The study uses time series (1996-2006) data on agriculture, service, industry and the various sub-sectors under agriculture, which includes forestry, fishery, crops/ livestock and cocoa. A regression model was specified and OLS was employed to estimate the respective impact of agriculture, service and industry on GDP growth. At the end of the study agricultural output had a significantly positive impact on Ghana’s growth as compared to the other sectors (agricultural output (0.354515); service output (0.283401); industrial sector (0.303257)). In addition, the study further analysed the effect of the various sub sectors under agricultural sector in GDP growth since the agricultural sector contributed more significantly to GDP. At the end of the study cocoa subsector was identified to be vital to economic growth and development in Ghana. Hence, the cocoa subsector should continue to be priority position even with the discovery of oil