Political Economy of the Mining Sector in Ghana

52 Pages Posted: 20 Apr 2016

See all articles by Joseph Ayee

Joseph Ayee

University of Ghana - Faculty of Social Studies

Tina Soreide

affiliation not provided to SSRN

G. P. Shukla

affiliation not provided to SSRN

Tuan Minh Le

affiliation not provided to SSRN

Date Written: July 1, 2011

Abstract

With a focus on the institutional set-up and the political environment as central to understanding and rectifying the poor impact of mining on Ghana's economic development, this paper highlights the vulnerabilities in mining sector governance along the industry value chain. The authors explain why it has been difficult to implement policies that would have improved social welfare. They find that incentive problems in institutions directly or peripherally involved in mining governance are a major factor, as are an excessively centralized policy-making process, a powerful executive president, strong party loyalty, a system of political patronage, lack of transparency, and weak institutional capacity at the political and regulatory levels. The paper argues that the net impact of mining on economic development is likely to be enhanced with appropriate reforms in governance. Most importantly, there should be a greater awareness of incentive problems at the political level and their possible implications for sector performance and the economy at large. The set of checks and balances, as stipulated by the Constitution, have to be reinforced. Furthermore, capacity building at different levels and institutions is needed and should be combined with efforts to enhance incentives for institutional performance.

Keywords: National Governance, Environmental Economics & Policies, Public Sector Corruption & Anticorruption Measures, Mining & Extractive Industry (Non-Energy), Governance Indicators

Suggested Citation

Ayee, Joseph R.A. and Soreide, Tina and Shukla, G. P. and Le, Tuan Minh, Political Economy of the Mining Sector in Ghana (July 1, 2011). World Bank Policy Research Working Paper No. 5730, Available at SSRN: https://ssrn.com/abstract=1892670

Joseph R.A. Ayee (Contact Author)

University of Ghana - Faculty of Social Studies ( email )

PO Box 25
Legon, Accra LG
Ghana

Tina Soreide

affiliation not provided to SSRN

No Address Available

G. P. Shukla

affiliation not provided to SSRN

No Address Available

Tuan Minh Le

affiliation not provided to SSRN

No Address Available

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