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Problem statement: Is inflation harmful? At what level? For all countries, both developed and developing, one of the fundamental objectives of macroeconomic policy is macroeconomic stability. In Ghana monetary and fiscal policies are aimed at sustaining high economic growth rates together with low inflation (price stability). Approach: This study estimated the threshold effect of inflation in Ghana for the period 1960-2008 using threshold regression models designed to estimate the inflation thresholds instead of imposing them. Results: We found evidence of a threshold effect of inflation on economic growth in Ghana. The result indicates inflation threshold level of 11% at which inflation starts to significantly hurt economic growth in Ghana. Below the 11% level, inflation is likely to have a mild effect on economic activities, while above this threshold level, inflation would adversely affect economic growth. Conclusion: The study concluded that the current medium term inflation target of 6-9% annual average set by the Bank of Ghana and the Government respectively is well below the 11% threshold is in the right direction

SMEs are pivotal to economic growth globally. They are however, often said to be constrained by the lack of or limited access to funding. Despite this assertion, the nature of the credit constraint problem is not well known in Ghana especially regarding its various dimensions. Knowing these dimensions is critical to formulating appropriate policies to deal with the problem. The purpose of this paper is to provide empirical evidence on the various dimensions of the credit constraint problem in Ghana. The survey strategy of enquiry was employed based on the adoption of the direct method of determining credit constraints. It was observed amongst other things that the credit constraint is almost entirely a supply-side problem as the demand-side constraint is almost non-existent. It has been recommended amongst other things that intervention policies should focus on the very small business as the incidence and degree of constraint tends to be higher amongst them.

This paper presents analysis of the relationship and dependence structure between stock returns and exchange rates in Ghana using data of daily periodicity from January 4, 2011 to July 31, 2014. Analyses are conducted by means of Bayesian quantile regression (QR) technique and multiple causality tests. Our findings suggest high dependence of the equity market on the foreign exchange market in Ghana, and that the link between the two markets follows the international trade‐oriented model more than the portfolio balance theory. We report that among the six exchange rates used, only the cedi–dollar registers instantaneous effect on the equity market.

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