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The study investigates the effect of economic and non‐economic factors on natural gas demand in Ghana at the aggregate and disaggregates levels. The structural time series model is employed as it has the ability of capturing exogenous non‐economic factors. The findings suggest that both economic and non‐economic factors influence natural gas demand. It further reveal that different sectors respond differently to these factors. The study recommends that policies such as natural gas price subsidies should be customised for different sectors to obtain optimal results.

The discovery of oil should transform economies, since oil revenues can be invested in infrastructure and the non-oil sector. Whilst oil discovery has transformed the economy of countries such as Indonesia, Norway and UK, the story is different in Sub-Saharan Africa. Available evidence in countries like Angola, Equatorial Guinea, and Nigeria suggests that economic growth has an inverse relationship with oil production. Some researchers have attributed this to lack of quality institutions and the politics surrounding oil production. In this study, we take a critical look at the politics of oil production in Ghana and its potential implications for the oil sector and national development.

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This paper has been prepared as part of a series of studies on 'Natural Resources, structural change, and industrial development in Africa' as part of a larger UNU-WIDER research project on 'Jobs, poverty and structural change in Africa'.