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Financial liberalisation, gender and poverty in Ghana

Josephine Yeboah
Robin Robin-Hovell
Peter Lawrence
Peter Quartey


Ghana has been widely regarded as an economic reform and poverty reduction successstory. Using three waves of the Ghana Living Standards Survey (GLSS) covering the periodfrom 1991 to 2005, this paper analyses the effects of Ghana’s financial liberalisation policieson poverty at the household level, taking particular note of gender differences. Theexpectation of liberalisation policies is that with financial deepening, a greater availability oflending will enable more households to use credit to raise their living standards through suchchannels as increased investment in high yielding variety production techniques including theuse of fertilizers and irrigation, higher educational achievement and better health provision.Using a variety of standard poverty analysis techniques, we examine changes in the patternof borrowing over the three waves, and in particular, how far there has been an improvementin the absolute and relative position of the poorest households. The paper also examineswhether female-headed households, which constitute a significant part of the sample, havefound greater access to credit over this period. We find that there is a reduction in theincidence of poverty as we move from households with no credit to households with creditfrom informal and formal sectors. We find that male-headed households are the majorcontributor to poverty incidence while poverty incidence among female headed householdshas declined sharply. In distributional terms, there appears to have been an improvement inthe position of middle and higher income households, but not of the poorest, with the bottom8.5% worse off than at the beginning of the period. These results raise a number of policyquestions concerning our understanding of the linkages between financial liberalisation andpoverty alleviation.

Publication Type(s)

Conference Paper

Ten Years of War Against Poverty Conference Papers

Conference: Ten Years of War Against Poverty


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