Hierarchical Bayesian Modelling of Macroeconomic Variables in Ghana

Koranteng Emmanuel Amoako (), Engmann Gideon Mensah () and Jakperik Dioggban ()
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Koranteng Emmanuel Amoako: Department of Statistics and Actuarial Science, School of Mathematical Science, C. K. Tedam University of Technology and Applied Sciences, Navrongo, Ghana
Engmann Gideon Mensah: Department of Biometry, School of Mathematical Science, C. K. Tedam University of Technology and Applied Sciences, Navrongo, Ghana
Jakperik Dioggban: Department of Biometry, School of Mathematical Science, C. K. Tedam University of Technology and Applied Sciences, Navrongo, Ghana

Statistics, Politics and Policy, 2024, vol. 15, issue 3, 351-382

Abstract: This study analyzed the impact of macroeconomic variables (manufacturing, real exchange rate, government expenditure, and gross fixed capital formation) on GDP growth in Ghana. Utilizing secondary data from the World Development Indicators of the World Bank (1991–2021), we employed a hierarchical Bayesian linear model with interaction effects to assess these relationships. The results indicate that the real exchange rate, manufacturing, and government expenditure have a positive influence on GDP growth, while gross fixed capital formation exhibits a moderately negative effect. To enhance economic growth, it is crucial to optimize capital investments, bolster export competitiveness through targeted policies, and invest in manufacturing innovation. These findings offer actionable insights for policymakers aiming to stimulate economic growth in Ghana.

Keywords: GDP growth; Ghana; hierarchical Bayesian model; macroeconomic variables (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1515/spp-2024-0013

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