Oil price shocks and domestic price investment in Ghana

Emmanuel Wiafe (), Charles Barnor and Christopher Quaidoo

MPRA Paper from University Library of Munich, Germany

Abstract: This study examines the effect of oil prices on domestic investment in Ghana using quarterly time series data from 1984 to 2012. Dynamic Ordinary Least Squares (DOLS) technique was used to estimate the effect of oil price on domestic investment in Ghana. The analysis revealed that there is long run relationship between domestic private investment, oil price shocks, exchange rate, inflation, income and credit to private sector. The study found negative effect of oil price shocks on investment. This indicate that shock in oil prices leads to a reduction in investment. It is therefore recommended that mechanisms be put in place to check or cushion the economy against oil price shocks and variability. This could be done through providing domestic credit to the private sector to boast investment.

Keywords: Investment; Oil price shocks; Oil price; DOLS; Shocks; Ghana (search for similar items in EconPapers)
JEL-codes: E22 E29 G00 G11 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-afr and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:60777

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