Ghana Living Standards Survey Research Articles

Risk Attitudes and Sources of Finance: Evidence from Non-Farm Household Enterprises in Ghana

ABSTRACT Several theories in economics and finance suggest that risk attitudes play a vital role in economic choices, including being an entrepreneur and the choice of finance for businesses. However, there are limited empirical tests of these theories in the African context, where majority of firms are small and medium-scale enterprises. Using the 7th round of the Ghana Living Standards Survey (GLSS 7), this study estimates the effect of risk attitudes on the decision to own a household enterprise and the choice of finance by owners of household enterprises. The study finds no significant impact of risk aversion on household enterprise ownership. We find risk aversion to significantly influence the use of self-financing as start-up capital; however, after controlling for access to finance, this effect reduces. We also did not find a significant relationship between risk aversion and the use of loan financing as working capital. The findings from this study shed light on the risk management strategy of household enterprise owners and suggest that access to finance is an important determinant of sources of financing. Hence, to spur growth of these critical household enterprises, the essential role of access to finance should be addressed by policymakers.

The impact of Ghana’s national health insurance exemption policies on healthcare-seeking behaviour

Countries all over the world are seeking to enhance the general well-being of their populations by instituting a prepayment health system in which people can access healthcare at any time without financial risks. In Ghana, the National Health Insurance Scheme (NHIS) seeks to achieve this objective while leaving no one behind. To accelerate the country’s UHC agenda, the scheme was designed to also provide premium exemptions to the poor and vulnerable. While the exemption policy removes financial barriers to both subscription and healthcare, its impact on health-seeking is unknown. This study, therefore, sought to evaluate the impact of the premium exemption policies on healthcare-seeking behaviours. Data from the most recent round of the Ghana Living Standards Survey (GLSS 7) was used. A total sample of 8297 individuals were included in the analysis comprising 5686 rural and 2611 urban dwellers. We used the Lewbel instrumental variable technique to correct potential endogeneity problems. We found that NHIS exemption policies improved both general and formal healthcare-seeking. For general healthcare-seeking, the impact was driven by individuals exempted through under 18 and aged category. However, focusing on formal care, both exemption through under 18 or aged category as well as through indigents or Free Maternal Services category both improved healthcare-seeking. The magnitude of the impact was also greater for categories that were fully exempted and did not require any form of payment to subscribe. The findings call for a policy review to differentially target individuals living in areas with different economic and health system realities.

Model-Based Prediction for Small Domains Using Covariates: A Comparison of Four Methods

Abstract We consider methods for model-based small area estimation when the number of areas with sampled data is a small fraction of the total areas for which estimates are required. Abundant auxiliary information is available from the survey for all the sampled areas. Further, through an external source, there is information for all areas. The goal is to use auxiliary variables to predict the outcome of interest for all areas. We compare areal-level random forests and LASSO approaches to a frequentist forward variable selection approach and a Bayesian shrinkage method using a horseshoe prior. Further, to measure the uncertainty of estimates obtained from random forests and the LASSO, we propose a modification of the split conformal procedure that relaxes the assumption of exchangeable data. We show that the proposed method yields intervals with the correct coverage rate and this is confirmed through a simulation study. This work is motivated by Ghanaian data available from the sixth Ghana Living Standards Survey (GLSS) and the 2010 Population and Housing Census, in the Greater Accra Metropolitan Area (GAMA) region, which comprises eight districts that are further divided into enumeration areas (EAs). We estimate the areal mean household log consumption using both datasets. The outcome variable is measured only in the GLSS for 3 percent of all the EAs (136 out of 5019) and 174 potential covariates are available in both datasets. In the application, among the four modeling methods considered, the Bayesian shrinkage performed the best in terms of bias, mean squared error (MSE), and prediction interval coverages and scores, as assessed through a cross-validation study. We find substantial between-area variation with the estimated log consumption showing a 1.3-fold variation across the GAMA region. The western areas are the poorest while the Accra Metropolitan Area district has the richest areas.

Is Cocoa Production a Main Driver of Children’s Work in Ghana?

Child labour in cocoa production remains a major concern. Yet, an overall assessment of the role of cocoa production in child labour, comparing with other household livelihood activities, as well as a more nuanced view on the work that is done by children, is lacking. Using data from the Ghana Living Standards Survey 2017, we model the probability of children’s work based on cocoa production and a set of other variables at child, parental, household and community level. We specify children’s work in different ways to better interpret employment conditions, compare effects across gender and age of the child, and address potential bias by controlling for measurement error and using an instrumental variable estimation and a coefficient stability approach. We find that cocoa production increases the probability of working on the own farm but not exceeding allowable work time or in harmful conditions. The effects are similar for boys and girls but are much larger for older children. Other farm-household activities, especially food crop production and livestock ownership, are much more strongly associated with children’s work, often under more harmful conditions. This implies that solely targeting the cocoa sector might run the risk to transpose child labour to other activities.

Parental financial inclusion and child proficiency in low-income settings: Family effects

Sustainable Development Goal 4 highlights universal education, yet in low-income economies, educational achievement levels, such as children's proficiency, often fall short of satisfactory standards. This study explores how family traits link parental financial inclusion to children's proficiency, using recent Ghana Living Standard Survey data 2016/2017 (round 7). Non-linear probit regression was employed, with standard errors corrected for both within cluster dependence and heteroscedasticity, yielding the following findings. This study highlights the connection between parents' financial inclusion and their children's proficiency levels, with outcomes varying based on family dynamics. Having bank accounts positively affects children's literacy, especially in households with educated mothers and male heads. Gender differences are notable in insurance and loan uptake, possibly reflecting different risk attitudes. The study recommends tailoring financial inclusion policies to accommodate family-specific traits.

The impact of financial inclusion on rural–urban households welfare inequality in Ghana: A decomposition analysis

AbstractThis article examined the impact of financial inclusion on rural–urban households' welfare inequality in Ghana using nationally representative survey data sourced from the seventh round of the Ghana Living Standard Survey. The article used a multidimensional financial exclusion index and the real per adult equivalent measures of total annual household consumption expenditure as measures of financial inclusion and welfare, respectively. The article employed the instrumental variable estimation technique to account for the issues of endogeneity and sample selectivity bias associated with measuring financial inclusion. The estimated results from recentered influenced function‐Ordinary Least Squares of the unconditional quantile regression and the Oaxaca‐Blinder techniques show significant rural–urban welfare gaps in favor of urban households at the mean and across the selected quantiles. The study also found that differences in financial inclusion between rural and urban households contribute significantly to the welfare gaps, while the economic returns to financial inclusion reduce the welfare gaps both at the mean and the selected quantiles. The study recommends that policies aimed at improving financial inclusion as well as strengthening financial institutions in rural areas be put in place to help reduce the rural–urban welfare inequality in Ghana.

Credit Access and Poverty in Ghana: Does the Source of Credit Matter?

ABSTRACT Poverty remains a concern for policymakers across the globe because a considerable number of individuals are still poor and unable to make a decent living for themselves. Among the efforts to combat poverty is to enhance the income of individuals by improving access to credit. Extant studies have investigated the nexus of poverty and credit access, but the majority of them tend to focus on microcredit without considering the broader theme of credit. Moreover, most of the studies ignored the potential endogeneity inherent in credit access. Again, studies that focused on Ghana are concentrated on some specific areas, districts, or municipalities of the country which does not reflect the country-wide effect of credit access on poverty. To bridge these study gaps, we analyzed the impact of accessing credit on poverty using more representative data within an instrumental variable (IV) framework that is robust to endogeneity. Besides, we extend the discussion by showing how the poverty impact of accessing credit from formal sources differs from informal ones. Using data from the 2016/2017 round of the Ghana Living Standards Survey (GLSS), we found that accessing credit generally deepens the poverty status of Ghanaians. However, the specific impacts of credit sources indicate that accessing credit from formal sources is more effective in reducing the propensity to be poor in Ghana. Additional findings show that age, income, and location of the individual have significant impacts on their ability to access credit to better their lives. It follows that efforts by the government to improve financial inclusion to roll in more people will increase credit access from formal financial institutions and help reduce poverty in Ghana.

Ecological shock and time poverty: Evidence from northern Ghana

Despite the importance of time poverty in economic decision-making and impact on welfare outcomes, empirical studies linking ecological shocks and time poverty is limited. This paper documents the relationship between an ecological shock and time poverty in northern Ghana using data from the seventh round of the Ghana Living Standards Survey (GLSS). We employ the standard instrumental variable (IV) method and conduct several robustness checks to ensure a robust estimate of ecological shock on time poverty. The results show that ecological shocks increases time poverty by 15 percentage points. The decomposition analysis of time poverty indicates that ecological shock is postively associated with time poverty based on paid work with no significant effect on time poverty based on unpaid work. Our results further show that the effect of ecological shocks on time poverty is a rural phenomenon. In addition, we note that the effect of ecological shock on time poverty is more prominent among the youth, large farm holders, and high-income earning household heads. The main implication of the findings is that development interventions that enhance access and adoption of gender-sensitive labour-saving technologies must be scaled up to reduce farm committed time, increase crop productivity and reduce the potential intergenerational transfer of time poverty. Provision of social protection measures such as the support through the Livelihood Empowerment Against Poverty to poor farm households would reduce the burden of ecological shocks on their wellbeing.

Healthcare utilization in Ghana: Insights from the 2017 Ghana Living Standard Survey.

The persistence of healthcare utilization disparities in Ghana despite several policy efforts highlights the urgency of understanding its determinants to enhance equitable health access. We sought to examine the determinants of healthcare utilization in Ghana. We used the 2017 Ghana Living Standard Survey (GLSS) data. This was a cross-sectional design, which employed a stratified two-stage random sampling technique. We analyzed data involving 8,298 respondents with information on visits to healthcare facilities for services on account of illness or injury two weeks prior to the survey. Pearson's chi-squared test was used to assess the distribution of healthcare utilization across background characteristics. Further, we used multivariable Poisson regression model with robust standard error to identify factors independently associated with healthcare utilization. Among the 8,298, the median age was 24 years (interquartile range = 7-47), 45% were males, and 45% had no education. About 42% of respondents utilized health services during an episode of illness or injury. Age, sex, educational level, marital status, wealth quintile, health insurance and severity of illness/injury were independently associated with healthcare utilization. Healthcare utilization increased significantly with wealth quintiles-those in the highest wealth quintiles had about 22% increased utilization compared to those in the lowest wealth quintiles (aPR = 1.22; 95%CI = 1.13-1.32) while it was about 77% higher among those who had valid health insurance compared to those without (aPR = 1.77; 95% CI = 1.68-1.86). Regarding severity of illness or injury, those with severe conditions were about 65% more likely to utilize healthcare services compared to those with acute conditions (aPR = 1.65; 95% CI = 1.53-1.78). Our study underscores the importance of socio-economic factors and health insurance in healthcare utilization in Ghana. Addressing these can pave the way for more equitable access to healthcare services across all segments of the population.

Poverty dynamics for Ghana during 2005/06–2016/17: An investigation using synthetic panels

Ghana has consistently kept its poverty rate lower than the regional average over the past 25 years, but this positive trend has slowed down recently. Without actual panel data, it would be next to impossible to probe into the dynamic patterns beneath this trend. We offer the first study that examines the dynamics of overall, moderate, and extreme poverty in Ghana during 2005/06–2016/17, addressing the lack of actual panel data by constructing synthetic panel data from three nationally representative cross-sectional rounds of the Ghana Living Standards Surveys (GLSSs).We present a well-defined decomposition framework, which allows us to examine a rich profile of the dynamics among different population groups. Beyond poverty analysis, we further investigate the dynamics of the full consumption expenditure distribution. Although we find considerable conditional chronic (extreme) poverty rates hovering around 50–60%, there was more upward mobility than downward mobility during this period. Poor households were also more likely to have stronger consumption expenditure growth. The findings suggest that factors such as educational attainment, female household headship, urban residence, and nonagricultural work are positively correlated with poverty reduction. Compared to all other correlates, educational attainment appears to be the most effective in pushing households out of poverty and keeping them from falling into poverty. These results contribute to the growing literature on poverty dynamics in developing countries in general and provide new and relevant inputs for policy advice in Ghana in particular, especially since policies that address chronic poverty typically differ from those that tackle transient poverty.

Can health financing programmes reduce food insecurity in a developing country?

Despite the devastating effects of out-of-pocket healthcare expenditures on households' financial outlays, which potentially stifle household resources needed for food consumption, the health financing program-food insecurity nexus is yet to receive much needed attention in the literature. This study makes a significant contribution by investigating the effect of health financing program, conceptualised as membership of a National Health Insurance Scheme, on household food insecurity using the food insecurity experience scale (FIES) and several quasi-experimental methods. Using data from the seventh round of the Ghana Living Standards Survey, our endogeneity-corrected results indicate that membership of a health financing program can contribute to reduction in household food insecurity. The results are robust to alternative conceptualisations of food insecurity and different quasi-experimental methods. The effect of health financing programme membership on food insecurity is more pronounced among urban and female-headed households. Our findings further point to household savings as an important channel through whichmembership ofhealth financing program reduces food insecurity.

Financial inclusion and improved water usage among households in Ghana

BackgroundIn Ghana, about 76% of households are at risk of drinking water polluted with faecal matter, hence, poor sanitation and unsafe water are responsible for 80% of all diseases in the country. Given this, some studies have been carried out concerning the factors that determine access and use of improved water among households in Ghana. However, although financial inclusion can make it easy for households to afford and hence, use improved water, it has received very little attention. This study, thus, examines the effect of financial inclusion on the use of improved water among households in Ghana.MethodsThe Ghana Living Standards Survey round 7 (GLSS7) is used as the data source while the binary logit regression is employed as the main empirical estimation technique.ResultsThe results show that households with financial inclusion (employing an indicator which has not been disaggregated into formal and informal financial inclusion) have a higher likelihood of using improved water sources relative to those without financial inclusion. The results are robust using formal financial inclusion as well as a combined index of financial inclusion.ConclusionEnhancing financial inclusion, especially formal financial inclusion can be utilised as a major policy instrument towards increasing access and use of improved water sources among households in Ghana.

Determinants of older people labour market decision in Ghana

PurposeThe purpose of this paper is to examine the prevalence of labour force participation and the factors affecting labour supply among older persons in Ghana. Both the extensive and intensive margins of older persons’ labour supply were analysed.Design/methodology/approachThe paper uses nationally representative samples of household and individual data in 2016–2017 – Ghana Living Standard Survey (GLSS 7) data – for the analysis. Heckman’s sample selection model is used to analyse both the extensive and intensive margins of older persons’ labour supply.FindingsThe study found that older persons in Ghana who are pensioners, widowed, have high levels of education, poor health status and live in urban areas are less likely to participate actively in the labour market. On the other hand, being head of a household, married and owning certain assets increase the likelihood of an older person to work. Furthermore, pensions, household headship and post-secondary education have negative effects on the labour supply as having them make older persons work fewer hours per week compared to their counterparts.Originality/valueThis research is the first study to examine the prevalence of old age employment and factors that affect labour market decisions of older persons in Ghana. It also adds to the limited literature on pension and retirement decisions in developing countries.

Consumption of clean and dirty cooking fuels in ghanaian households: The role of financial inclusion

Home cooking is considered an important activity which promotes healthier lives, sustenance, and binds families and people together. Despite the benefits of home cooking, it is the leading source of household air pollution and its associated health risks particularly for developing countries including Ghana. The role of financial inclusion in facilitating the achievement of the Sustainable Development Goals (SDGs) of the United Nations is explored in this study for clean cooking technologies (i.e., SDG 7). The proposed study is based on three datasets from the Ghana Statistical Service (GSS), comprising of Ghana Living Standard Survey (GLSS) round 6, round 7 and the pooled form. Using distance to the nearest financial institution as instrument, the study employed probit two-stage least squares to investigate the heterogenous impacts of financial inclusion on household cooking fuels in Ghana. The findings show that financial inclusion increases the consumption of clean cooking fuel but reduces dirty fuels such as firewood, charcoal, kerosene etc. Female-headed households were found to be more impacted by financial inclusion over time than their male counterparts. The results also showed that financially included rural households reduced their consumption of dirty cooking fuels than their urban counterparts. These findings have important policy implications.

Effects of water, energy, and food security on household well-being.

Water, energy, and food insecurity are significant challenges that affect both economies and households, particularly in developing countries. These resources have an effect on households wellbeing, businesses, and all sectors of the economy, making them critical to ensuring household well-being, which is frequently measured by quintile welfare. As a result, there has been a significant increase in interest in securitizing these resources in order to mitigate their negative effects on household's wellbeing This study provides an empirical investigation of the determinants of water, energy, and food (WEF) security and the effect of water, energy, and food security on household well-being in Ghana. This study provides an empirical investigation of the determinants of water, energy, and food (WEF) security and the effect of water, energy, and food security on household well-being in Ghana. The study used a sample of 2,735 households from the Ghana Living Standard Survey (GLSS) Wave 7. We applied an instrumental variable probit, complementary log-log and ordered Probit estimation techniques for analysis. Empirical analysis reveals several important findings. Firstly, factors such as age, credit access, household location, employment status, and livestock ownership positively contribute to household water security, while remittances, water supply management, water bills, and water quantity have negative impacts. Secondly, age, marital status, household size, remittances, and livestock ownership significantly influence household energy security. Thirdly, marital status, household income, credit access, and household size are crucial determinants of household food security, with residence and region of household location exerting negative effects. Additionally, while water and energy security have a relatively lower impact on household well-being, food security emerges as a key driver in promoting household wellbeing. The study recommends that policymakers and stakeholders design and implement robust programs and interventions to sustain households' water, energy, and food supply.

Trends and Relationship between Education and Poverty in Ghana: Evidence from Ghana Living Standards Surveys from 1991 to 2017

Trends and Relationship between Education and Poverty in Ghana: Evidence from Ghana Living Standards Surveys from 1991 to 2017

Annual Spending on Formal Education Among Households in the Ashanti Region of Ghana: A Ghana Living Standards Survey Seven Investigation

Annual Spending on Formal Education Among Households in the Ashanti Region of Ghana: A Ghana Living Standards Survey Seven Investigation

An Empirical Analysis of Ashanti Region Annual Household Education Expenditure Using the Ghana Living Standards Survey Round Six Data

An Empirical Analysis of Ashanti Region Annual Household Education Expenditure Using the Ghana Living Standards Survey Round Six Data

Annual Household Budget Share in Formal Education Expenditure Using the Ghana Living Standards Survey Round Six Data: A Micro-Level Statistical Investigation

Annual Household Budget Share in Formal Education Expenditure Using the Ghana Living Standards Survey Round Six Data: A Micro-Level Statistical Investigation

Estimating public and private sectors' union wage effects in Ghana: is there a disparity?

PurposeThis study seeks to estimate union wage effect in the public and private sectors of Ghana, respectively. It also seeks to ascertain whether the union wage effect in the two sectors varies.Design/methodology/approachThe authors use data from the Ghana Living Standards Survey 6 (GLSS 6, 2012/2013) and Ghana Labour Force Survey (GLFS, 2015). In terms of estimation technique, the authors employ the Blinder–Oaxaca decomposition technique to estimate union wage effect in public and private sectors, respectively.FindingsThe findings indicate that union wage effect in the public sector is positive and higher relative to that of the private sector.Practical implicationsThe findings imply that strict enforcement of Section 82 of Labour Act 2003 (Act 651) will curb the political influence of public sector unions over their employer (Government).Originality/valueThis research paper has not been presented to any journal for publication and it is the authors' original work.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-01-2023-0045