CASE STUDY REPORT FORMAT

Case Study Case Study 5: Institutions, Inequality, and Incomes: Ghana and Côte d’Ivoire
No./TITLE
Chap. No./Title Chapter 5: Poverty, Inequality, and Development

 INTRODUCTION

 Introduction/Brief background of the case

The economic histories of Ghana and Cô te d’Ivoire since their independent with each other
were very different. From 1821 to 1957, Ghana was part of British empire while the Cô te
d’Ivoire was a French colony from 1842 until 1960. In the period of 1960 Ghana experienced
collapsed economy with the real GDP per capita income of just $594 compared to Cô te d’Ivoire
with $1,675. In this topic, we will know more about how the economy of the Ghana and Cô te
d’Ivoire become different after several years.

 EVALUATION OF THE CASE

o Economic Growth
 Economic Growth Indicators (GDP/GNP)
Ghana – In 1960, it has a real GDP per capita of just $594. But according to the
Penn World Table, Ghana revive its economy in 2007 that reached $1, 653 – a
gain of 278%.
Côte d’Ivoire – It has a real GDP per capita of $1, 675, much bigger than Ghana
in 1960. The GDP increased in $2, 228 – a gain of 33% after 47 years
o Economic Development
 Economic Development Indicators
 Income and Growth (Per capita income)
 Ghana has an HDI of 0.526 while Cô te d’Ivoire considered a low
human development country with an HDI of 0.484.
Multidimensional Poverty Measure Index reveals that Ghana’s
index is 0.140, 57 in ranking, which explains that the population
were living on less than $1.25 a day. In contrast to CIV, index
rank was much lower than 78 with the value of 0.320.
 Social Indicators
1. Human Development Index (life expectancy, under 5 mortality
rate, incidence of child labor, literacy rate)
 In 1960, the life expectancy in Ghana was 46 but in 2007
each people had a life expectancy of 57. Compared to
CIV, the life expectancy was 51.
 In 2008, under-5 mortality was 114 in CIV and still high
but significantly lower 76 in Ghana.
 According to the information, the adult literacy rate
today is 65.0% in Ghana compared to 48.7% of CIV.
 In addition, Ghana suffered in forced labor/slave trade
while the CIV suffered from ill-treatment including
brutal campaign from French.
 Mortality was high in both countries with estimated 668
deaths per 1,000 per year.
2. Poverty
 The poverty was far higher in Ghana than the CIV. The
World Bank uses the 1987 survey to show the
percentage of poverty in both places. It shows that
3.28% in CIV while in Ghana was 46.51%. As of 2010, the
data shows that the poverty was fallen in Ghana with
36% and it rises in CIV with 16%.
3. Problems on Inequality (gender inequality, inequality in income

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CASE STUDY REPORT FORMAT
Case Study Case Study 5: Institutions, Inequality, and Incomes: Ghana and Côte d’Ivoire
No./TITLE
Chap. No./Title Chapter 5: Poverty, Inequality, and Development

and land distribution)

 According Transparency International, Ghana ranked
69th regarding corruption perception and CIV ranked
154 out of 180. It shows that the institutional quality in
terms of fairness and equality has gotten worse. Extreme
inequality can obstruct economy’s progress. In 1987, the
World Bank estimated that the Gini was .345 in Ghana
and .404 in CIV. By 2002, the Gini in CIV rises at .484 and
.408 in Ghana.
 There is a conflict in ethnic or cultural differences that
can lead to political disturbance

 IDENTIFICATION OF THE PROBLEM

 Key Issues
o Côte d’Ivoire experienced fast growth in the 1960s and 1970s then suffered a
decline from 1980 up to the present. Ghana, on the other hand, suffered
disastrous policies and extreme instability along with coups during mid-1960s to
early 1980s.
 Causes
o Both countries have a mortality rate of 668 deaths per 1000 per year
o Ghana having a fertility rate of 4 births per woman and CIV 4.9
o Only 17% of women used contraceptives in Ghana and only 8% in CIV
o Both failing education indicators before their independence with CIV having lower
investments in education after their independence
o Both countries suffer in poverty with the latest report showing 28.6% of families living in
Ghana lived below $1.25 a day while 23.8% of the families in CIV lived below such
standard
o Both countries suffer colonialism with Ghana by the British Empire and CIV a French
colony

 GOVERNMENT RESPONSES

Ghana
In terms of better development, Ghana have substantially exceeded CIV in terms of population
control, education, inequalities and policies implemented. However, the country's poverty line is still poor
and was having trouble on how they would manage their GDP per capita. Having that said government
implemented different policies involving education, reformation programs and policy transformation,
which would follow as:
 Strong policy providing education: As Edward Gleaser argues that improved education can
result in improved institutions. Ghana’s educational attainment was abysmal so in order to
achieve higher level of education governments focused on investing and as a result, education can
finally reach even in the poorest area in Ghana
 Underwent Policy Transformation: Ghana’s early policies were chosen poorly and often
conceived as corrupt interventionists. policies where it is towards urban industries. Later on,
Ghana would undergo a new policy after a disastrous and extreme instability.
 Large-Scale Reform: Ghana’s problems got so bad that they have no choice but to embrace
reform. However, it is a gamble because sometimes when the situation is bad enough, the solution

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CASE STUDY REPORT FORMAT
Case Study Case Study 5: Institutions, Inequality, and Incomes: Ghana and Côte d’Ivoire
No./TITLE
Chap. No./Title Chapter 5: Poverty, Inequality, and Development

for it is futile that’s why Ghana became an example of duress “causes” reform because they waited
for the situation to get bad before addressing the solution.
 Higher Price to Farmers and Technical Assistance: Cocoa had been an important part of
Ghana's Economy, however due to the state marketing boards the said Cocoa declined because of
limited prices to farmers and to subsidize the industrialization. But after that farmers were given a
higher price, outputs greatly increased as well as they gave them technical assistance and a better
fertilizer.

CIV (Côte d Ivoire)

In comparison to Ghana, CIV was struggling on the development and growth of the economy, one
factor is that they made almost no response at all. They still followed their traditional civil law under the
French rule and have done nothing but to follow their current policies as a result the development doesn’t
change much. However, there is one policy they implemented focusing for the improvement of the ethnic
group in urban areas:
● Implementing Ethnically Based Policies: By focusing on their agriculture side where most of
their poverty line came from, they implemented a policy where the ethnic groups are engaged and
gaining benefits from the national economy, as a result they precipitate the disaster of regional
and ethnic conflict in the 2000’s

 EFFECTS OF GOVERNMENT RESPONSES ON THE ECONOMY

GOVERNMENT RESPONSES EFFECTS

Ghana
● Strong policy providing education
● Underwent a policy transformation
● Large-scale Reform
Ghana
● In 2010 according to UNDP Ghana
has increased schooling more than
twice (7.1) than CIV (3.3)
● Ghana became a favorite country of
liberalization promoters in World
Bank and elsewhere in 1980’s
● Contradicts Danil Rodrik’s “It’s not
clear how much duress is enough to
cause reform”

● Higher salaries to farmers and ● Cocoa growing are now sustained

technical assistance and provides a basic livelihood for
over 700,000 farmers in Ghana
CIV CIV
● Implementing ethnically based ● A large migration to CIV occurred
policies most of them are from Burkina Faso
and the precipitation of the disaster
in both regional and ethnic groups
 RECOMMENDATIONS

 Poverty Eradication
o Ghana should continue in striving to implement its market-friendly policies
o CIV should revise their market-based, export-oriented path so that it will benefit
people more in the rural areas
o CIV should try decentralizing its administrative powers and refrain from expecting too

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CASE STUDY REPORT FORMAT
Case Study Case Study 5: Institutions, Inequality, and Incomes: Ghana and Côte d’Ivoire
No./TITLE
Chap. No./Title Chapter 5: Poverty, Inequality, and Development

much from their former colonial ruler, France

 Education
o Ghana should continue investing in its education to poorer areas
o CIV should give more attention and investments to their education
o Ghana may have a lead in education, but both countries are still lacking in it in
comparison to other countries. They could both implement programs like the
Progresa/Oportunidades of Mexico where thay will give cash transfers if families keep
their children to school
 Health
o Ghana may have a higher life expectancy than CIV, they’re both low nonetheless
compared to its neighboring countries. Ghana should continue its recent success in
scaling up basic health insurance
o CIV should give more priority in the health of its citizens. Both countries may adapt the
program of Brazil which is the Bolsa Familia to help the poorer families better take
care of themselves
 Population Growth
o Both countries should promote family planning programs as higher population growth
is associated with slower per capita income.
o Their governments should also raise awareness among their citizens the dangers and
bad indicators of teenage pregnancy
 Agriculture
o Both countries should innovate their technology regarding their agriculture
o CIV should give consideration in giving more technical support to their agricultural
sectors to avoid the mistake of Ghana that tried to limit the price farmers received for
cocoa
o Both countries should try to find more products they can export in the international
market

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