Ghana: Monetary Targeting and Economic Development
"The objective of the paper, is to propose a financial programming framework that uses the technique of targets and indicators to assist the monetary authority in conducting policy to achieve its macro-economic goals. The proposed programming framework will be based on the absorptive capacity of the economy, which will be endogenously determined; the institutionalization of indirect measures of control of ultimate targets using operating and intermediate instruments; open market operation; and moral suasion. Section II of the paper outlines targeting requirements and options. This is followed in Section III with some stylized facts of the monetary management process in Ghana during the adjustment era. Section IV gives our proposed targeting framework and Section V deals with implementation and methodology. Next are sections VI and VII, which discuss the use of money demand and supply, respectively, in establishing liquidity targets. The paper concludes with remarks and policy recommendations."