The Return to Capital in Ghana

15 Pages Posted: 23 Mar 2006

See all articles by Christopher Udry

Christopher Udry

Northwestern University

Santosh Anagol

Yale University - Economic Growth Center

Date Written: March 2006

Abstract

We show that the real return to capital in Ghana's informal sector is high. For farmers, we find annual returns ranging from 205-350% in the new technology of pineapple cultivation, and 30-50% in well-established food crop cultivation. We also examine the relative prices of durable goods of varying durability, and estimate a lower bound to the opportunity cost of capital of 60%.

Keywords: Capital, durable goods, credit markets

JEL Classification: O12, O16, D24

Suggested Citation

Udry, Christopher and Anagol, Santosh, The Return to Capital in Ghana (March 2006). Yale University Economic Growth Center Discussion Paper No. 932, Available at SSRN: https://ssrn.com/abstract=893023

Christopher Udry (Contact Author)

Northwestern University ( email )

2001 Sheridan Road
Evanston, IL 60208
United States

Santosh Anagol

Yale University - Economic Growth Center ( email )

Box 208269
New Haven, CT 06520-8269
United States

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