CHRISTOPHER MCCARTY and JOHN ATTAFUAH CONSUMER CONFIDENCE IN GHANA AND ITS IMPLICATIONS FOR SURVEY-BASED ECONOMIC INDICATORS IN AFRICA

During the next decade, many African countries will almost certainly become more politically and economically stable. An increase in the amount of foreign private investment as well as the blossoming of local entrepreneurship will inevitably follow. When this happens, government and private institutions will face obstacles of a different kind. As in most developed economies, the focus will change from building roads to building an information infrastructure. Success and failure of businesses in developed economies is largely based on who has access to the most current and accurate information. This information may range from price-level data to market demand surveys. Businesses use dozens of data series to make investment decisions in the United States. For example, the Census Bureau provides information on population and retail sales. The Bureau of Labor Statistics gives estimates of consumer and producer prices, employment and wages. Other commonly used data series come from the Federal Reserve, the National Association of Realtors, the National Association of Purchasing Management and the Conference Board. Government, semi-private and private sources use a variety of methods to collect these data, some survey-based and others through monitoring goods directly or transaction surveillance. This paper focuses on one such measure, consumer confidence, and what it tells us about the Ghanaian economy and politics, and about the validity and reliability of survey-based economic indicators in a developing economic and political landscape. The data from this study come from two omnibus surveys conducted in the Republic of Ghana, one in 1997 following the 1996 national elec-