Original Research

Assessing the impact of macroeconomic variables on pension benefits in Ghana: A case of Social Security and National Insurance Trust

Grace Ofori-Abebrese, Robert Becker Pickson, Sherifatu Abubakari
South African Journal of Economic and Management Sciences | Vol 20, No 1 | a1703 | DOI: https://doi.org/10.4102/sajems.v20i1.1703 | © 2017 Grace Ofori-Abebrese, Robert Becker Pickson, Sherifatu Abubakari | This work is licensed under CC Attribution 4.0
Submitted: 18 November 2016 | Published: 24 October 2017

About the author(s)

Grace Ofori-Abebrese, Department of Economics, Kwame Nkrumah University of Science and Technology, Ghana
Robert Becker Pickson, College of Economics and Management, Sichuan Agricultural University, China
Sherifatu Abubakari, Department of Economics, Kwame Nkrumah University of Science and Technology, Ghana

Share this article

Bookmark and Share


Background: One of the most pressing phases for all economic agents is post-retirement standard of living. Irrespective of the higher returns on pension contribution and varied pension reforms, there are possible factors that can render these pension benefits inadequate, which can affect the longevity of retirees. Studies conducted in other countries have concluded that inflation deteriorates the value of pension benefits.

Aim: This study, thus, sought to assess the impact of some major economic indicators in the Ghanaian environment on pension benefits.

Setting: This study was carried out in Ghana by obtaining quarterly data frequencies on pension benefits and economic indicators spanning the period 2000Q1 to 2014Q4.

Method: The Auto-regressive Distributed Lag Model was utilised to examine the long run and short run dynamics of some major economic indicators and pension benefits.

Results: The empirical evidence indicated that inflation deteriorates total pension benefits. Increasing monetary policy rate and depreciation of the domestic currency should be an issue to contend with only in the short run rather than in the long run. The study also found the prominence of the implementation of the National Pension Reform in 2008.

Conclusion: The study concluded that if policy makers target the reduction in the monetary policy rate and the appreciation of the domestic currency in an effort to stabilise the value of total pension benefits in the long run, it would not be effective in the long run because of their insignificant nature. Policy makers should rather target inflation as the prime tool for stabilising the standard of living of retirees in the long run.


pension benefits; exchange rate; inflation; interest rate


Total abstract views: 661
Total article views: 1851

Crossref Citations

No related citations found.