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United Kingdom-Ghana Economic Growth Disparities


The economy of a given country will influence the experiences and lifestyles of its citizens and how they address emerging challenges. Nations will have diverse rates of growth that are determined by various factors, including productivity factor and the rate of growth in the available triggers of development. With proper mechanisms and incentives, governments can empower their people and provide the relevant resources that can eventually deliver positive results. The purpose of this paper is to explore some of the contributing factors that have led to economic growth disparities between the United Kingdom and Ghana. While considering most of the key factors, the primary focus of this discussion will be the total factor productivity (TFP) and the rates of growth in the quantity of factors.

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The global community has some countries that record positive economic growth patterns while others lack incentives and strategies to achieve such an objective. Van Reenen (2016) identifies growth of a nation’s economy as the increase in the value of services or goods within the period under study. Analysts and economics use the concept of gross domestic product (GDP) to measure the rate at which a given economy is shrinking or expanding. GDP would refer to the value of all services and goods that a country or society produces in a specific period, usually twelve months (Peterson, 2017). When the figure is positive, it becomes clear that the level of production has been increasing steadily. Experts encourage analysts to several years of growth in order to get a clear image of a country’s GDP and performance.

When the rate of expansion is higher, the government will maximise its spending and meet the demands of its citizens. Without proper growth, a country might be forced to borrow money from elsewhere to meet some of the emerging demands. Consequently, the levels of poor health outcomes and poverty will increase significantly. Van Reenen (2016) explains why leaders need to pursue both GDP and economic development if they are to deliver sustainable results. Islam and Ali (2015) believe that the latter creates the best environment for competitive jobs, better shelter and living standards. The introduction of appropriate policies and structures will make it easier for a given economy to record better results in the future.

Ghana and United Kingdom: Disparities in Economic Growth

Economic disparities between nations is a common phenomenon across the globe due to the nature of the implemented policies, the factors of productions and how the government expands them, the nature of political systems and the overall productivity. Ghana is one of the West African countries whose economy has been growing rapidly within the past two decades. For example, its current GDP is around 65.56 billion US dollars while that of 2010 was around 27 billion US dollars (Fröhlich, 2019). However, the country continues to record cases of poverty that affect over 23 percent of the population (Fröhlich, 2019). These aspects reveal that the country’s economic growth and development are worth revisiting. Such an approach can make it easier for more people to lead better and more sustainable lives.

On the other hand, a steady economic growth pattern has been recorded within the past three decades in the United Kingdom. In 2019, the government reported a total GDP of 2.855 trillion US dollars (Fröhlich, 2019). The percentage of individuals below the poverty line is around 6.5 percent. These statistics reveal that the UK has better economic structures hat continue to promote growth while providing the necessary opportunities to the greatest number of citizens.

The first reason why there are noticeable disparities between these two nations is the factors of production and how the governments expand them. Some of them include natural resources, human resources, population, technology and legal systems. Using the case of the UK, it is evident that the government has balanced the level of demand and supply for some of the available resources, such as wood and metal, to reduce chances of depletion (Van Reenen, 2016). The government has gone further to ensure that people invest in the relevant fields and utilise land properly. In Ghana, natural resources are usually exported at a low price, thereby making it impossible for the government and investors to increase their revenues (Darko, 2015). Land, water and agricultural products are not used in a sustainable manner in this African country.

The issue of population is critical since it translates to labor and eventually dictating the level of productivity. When the number of people in a given country increases, the level of workforce will expand accordingly. In the United Kingdom, most of the citizens receive adequate resources to become more productive and capable of handling wide range of tasks. In Ghana, only a small percentage of the population receive basic training or education to prepare them for new roles and activities. With the rate of population growth standing at 2.2 percent and contrasted with the UK’s rate of 0.6 percent, the levels of poverty and unemployment have increased significantly (Fröhlich, 2019). This analysis reveals that the issues of population growth and empowerment have remained divergent in these two countries.

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Human capital is another factor whose quantity and growth can dictate the rate at which the economy of a given country grows. In Ghana, growth or quantity in human capital has received minimum attention (Darko, 2015). The country has failed to invest in science and technological fields. Consequently, majority of the citizens have to operate in the white-collar sectors while those in the UK are able to earn a living from the white-collar sector.

Technology has become a new attribute of economic growth that many countries are taking seriously than ever before. When those in leadership positions consider additional resources and trainings, more people will be ready to acquire the right competencies and maximise the level of productivity. This outcome is noticeable in the UK even when the available labor remains constant (Shimeles and Nabassaga, 2017). In Ghana, the rate of expansion in the field of technology remains minimal, thereby resulting in a slow rate of economic growth (Darko, 2015). In the UK, technological implementations have made factories sustainable and more productive through the use of emerging technologies. Many companies are capable of producing more goods while reducing the costs of production. The failure of Ghana’s government to expand the use and availability of this factor has resulted in a slow economic growth.

The existing legal frameworks and laws have emerged as powerful factors of production. For instance, the new classical macroeconomics is a powerful theory which indicates that citizens will develop rational views and expectations about the introduced government policies and the subsequent implications. If the economy is to function positively, there is a need for those in power to ensure that the issue of employment is prioritised. The Keynesian economics has remained an effective and practical model for explaining how countries tend to have growth disparities (Ghirwa and Odhiambo, 2016). Accordingly, the absence of effective government interventions will trigger instability and affect the experiences of the people. Using this macroeconomic view, the reader realises that the UK government has expanded this factor in a positive manner to increase production and responsiveness. The opposite is true in Ghana whereby the absence of proper legal infrastructure has affected the level of economic growth.

The second aspect that explains the current disparities in the selected two countries is that of factor productivity. Peterson (2017) defines total factor productivity (TPF) as the productivity measure derived after dividing the total production of the economy with the weighted median of the existing inputs. When governments fail to take these aspects into consideration, chances of recording poor results in economic performance increase significantly. In the United Kingdom, the government has expanded the nature of capital and labor to ensure that they translate to positive growth (Ghirwa and Odhiambo, 2016). This objective is realised by ploughing back the acquired capital and equipping more citizens with additional resources to pursue their entrepreneurial goals. In Ghana, these trends have not been common since the government has failed to consider the importance of financial incentives to maximise outputs.

Similarly, labor emerges as an important input for improving economic performance. Countries experiment or try divergent measures to ensure that the available human resources are capable of sustaining the level of growth. They can introduce additional technologies and provide high-quality education in technical subjects. The provision of additional skills will empower more citizens to complete a wide range of tasks (Peterson, 2017). These procedures have been common in the UK whereby the government maximises the effectiveness of labor. In Ghana, the government has failed to expand this factor in an effort to increase outputs.

On top of the above two forces, there are various aspects that might dictate the rate at which the economy of a country grows. This means that the field of macroeconomics can be expanded to incorporate a wide range of issues that have the potential to either improve or affect economic growth and performance. For instance, such models are analysed from the lens of the existing political systems in a given market or nation. The established leadership models are aimed at addressing, identifying, or describing the best strategies to mitigate various problems, including unemployment and increased inflation (Boldeanu and Constantinescu, 2015). The political structure will formulate and present recommendations to deal with such issues. These aspects explain why the existence of a democratic leadership and governance in the UK has presented new opportunities for continuous economic growth. In Ghana, the economy has been growing steadily in the past decade due to the presence of good managerial practices (Fröhlich, 2019). However, there are specific governance issues that need to be addressed if positive patterns are to be recorded, such as effective application of the law and promotion of democratic tendencies.

The nature and effectiveness of the existing institutions in a given country will have direct implications on economic performance. Using the case of Ghana, it is evident that more people are unable to maximise their outputs when compared with the experiences of many UK citizens. In this country, the judiciary remains independent or capable of determining legal cases without the control of the executive (Boldeanu and Constantinescu, 2015). Investors and individuals find it hard to pursue their goals due to the weaknesses associated with the institutions intended to fight corruption and dishonest business practices (Fröhlich, 2019). Without proper frameworks in this country, it has become impossible for the government to record meaningful investment and growth. The UK example is outstanding since the rule of law is a determining factor in the manner in which different companies and citizens pursue their objectives.

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Using the Keynesian economics model, it becomes quite clear that positive policies and appropriate government interventions and institutional frameworks will deliver a liberal market and economy that can find sustainable solutions to the major challenges members of the society appear to go through. Similarly, neoclassical economics and the proposal to increase the level of influence through proper policy introduction will support the functionalism of a conservative political system that governs the least (Fröhlich, 2019). These attributes will create a new scenario whereby different market structures and forces of consumption emerge. Consequently, the level of economic growth might take a different shape or form. The neoclassical model appears to describe the case of the UK and how it continues to improve the level of economic performance.

The rate and nature at which a given economy will stagnate or grow will, therefore, be triggered by the existing policies, politics and the leaderships approaches put in place. The development of such theories becomes a new opportunity for different stakeholders to explore and describe the potential trends and propose better measures for overcoming the major challenges different members of the society have to encounter in their lives. The government of Ghana would need to consider the outlined macroeconomic frameworks and theories in order to identify the existing gaps and challenges that affect growth (Fröhlich, 2019). The provision of adequate resources, promotion of better governance practices and the consideration of the quantity of the above factors will make a difference and overcome the challenges of unemployment and poverty. All agencies in Ghana need to be involved to identify potential gaps that might affect economic performance and present the right strategies to transform the situation. Such an approach will empower more people to engage in various activities that can eventually result in increased GDP.


The above discussion has identified the UK and Ghana as countries with long-term differences in economic growth. The analysis has revealed that the existence of different rates of growth in the quantity of factors and factor productivity have led to such disparities. Some of the other possible causes include the established government systems, existing institutions and the level of control by those in power. The outlined macroeconomics issues and theories should, therefore, become powerful guidelines for the government of Ghana to adopt a superior model that can overcome the existing obstacles and eventually attain the intended economic development and sustainability index. The government should also be involved by providing the relevant support systems and resources in order to transform the lives and experiences of the greatest number of citizens.


  1. Boldeanu, F.T. and Constantinescu, L. (2015) ‘The main determinants affecting economic growth’, Bulletin of the Transilvania University of Braşov, 8(2), pp. 239-338. Web.
  2. Darko, C.K. (2015) Determinants of economic growth in Ghana. Accra: Leibniz Information Centre for Economics.
  3. Fröhlich, S. (2019) ‘IMF World Economic Outlook puts Ghana in the lead’, DW. Web.
  4. Ghirwa, T.G. and Odhiambo, N.M. (2016) ‘Macroeconomic determinants of economic growth: a review of international literature’, South East European Journal of Economics and Business, 11(2), 33-47. doi: 10.1515/jeb-2016-0009
  5. Islam, K.M. and Ali, A. (2015) ‘Recognizing development beyond economic growth: by analyzing impact of inequality on development’, International Journal of Research in Business and Technology, 7(3), pp. 928-938. doi: 10.17722/ijrbt.v7i3.428
  6. Peterson, E.W.F. (2017) ‘The role of population in economic growth’, SAGE Open, 1(1), 1-15. doi: 10.1177/2158244017736094
  7. Shimeles, A. and Nabassaga, T. (2017) Why is inequality high in Africa. Abidjan: African Development Bank Group.
  8. Van Reenen, J. (2016) Brexit’s long-run effects on the U.K. economy. Boston: Massachusetts Institute of Technology.

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