Research problem
Agriculture is crucial in the rural economy, and much attention is given to both the rate and pattern of agricultural development. But nonfarm activities and policies that affect interactions between agriculture and industry also are important determinants of employment and income (Timmer 1991). Ultimately, the major strategic question regarding rural nonfarm activities and industrial strategy is the same as it is for agricultural development: What policies can help raise productivity and increase employment opportunities? Any strategy to develop agriculture and the rural economy needs time. Why not attack the most serious effects of chronic hunger, as in famine relief, by targeting food and other assistance to help those most in need? Famine relief is feasible because the food and money needed to relieve the worst effects are small on a global scale, and the needs are intermittent, often concentrated in regions within countries. Political and logistical problems are the main barriers to famine relief, not food supply and financing. There is no fixed relationship, between agricultural development and environmental stress. Both are influenced by national policies and by investments that seek to increase research capacity and the knowledge needed to shift from resource-based to knowledge-based agricultural systems (Johnston, Kilby & Tomich 1995). Agriculture and its development play a big part in making sure that a country’s economy will prosper. Agriculture provides food on the table, reasons, some products to export and a source of income for the citizens. This proposed research wants to analyze the effectiveness of agricultural development bank on the growth of the Ghanaian economy. This research wants to understand the concept of agricultural development bank and how its assists the economy.
Importance of research
The proposed research will help in understanding agricultural development bank. The proposed research will introduce Ghana and its economic policies. The proposed research will help in analyzing how agricultural development banks assist Ghana and its economy.
Literature Review
Production conditions in both agriculture and industry are considered important and there is much more serious modeling of savings and investment. However, although the relative price of food plays an important role in the analysis, dynamics of inflation are not studied. The paucity of resources makes it necessary for the public sector to invest in these industries. The presence of secondary uncertainty makes it necessary for all these production decisions to be planned and coordinated. The fact that markets for these goods do not exist in the home economy implies that price signals are of little use and quantitative control would have to be exercised. The basic philosophy that industrialization was most important led to an implicit neglect of agriculture. The need to transfer resources from agriculture to industry was emphasized (Jha 2003). The backwardness of financial markets means that avenues for government borrowing are rather limited. Governments typically indulge in forced sales of government bonds to the banking system. This is done through an elaborate system of reserve requirements. It is not uncommon for the government to unload onto the central bank. The central bank uses some of these as a base for monetary expansion and, quite often, commercial banks are required to hold part of their reserves on terms of government bonds. These reserve requirements are, in turn, often quite high, the fact that the central bank uses government bonds as a base for monetary expansion means that the government debt tends to get monetized. The process of revenue extraction by the government is much too complicated to be captured in a single diagram. Primary savers save in the form of currency and cash, which are liabilities of the central bank. They are also liabilities of the commercial banks. Part of these is effectively transferred to the central bank through reserve requirements and purchase of government debt, leaving only a fraction for free lending. The public also saves with savings banks and post offices. These savings are channeled in a similar manner. The central bank has to transfer resources to the government through purchase of government bonds. It also has to lend directly to certain priority sectors. These priority borrowers may be industrial development banks, agricultural development banks, public sector undertakings, private sector undertakings in the ‘core’ sector and the like (Puymbroeck 2001).
Methodology
Qualitative method will be used in the study. Qualitative method thrives on understanding data through giving emphasis on determining people’s words and actions. Qualitative method has an orientation that it should gather data that can be acquired through quantitative methods. The tasks of understanding and presenting qualitative research can be very demanding and can be compared to the task of understanding statistics. In qualitative research, the researcher creates a natural setting which he/she can use to understand a phenomenon of interest. Even if the focus is on a smaller case, qualitative research usually unearths a very big amount of information from the respondent.
References
Jha, R 2003, Macroeconomics for developing countries, Routledge, London.
Johnston, BF, Kilby, P & Tomich, TP 1995, Transforming agrarian
economies: Opportunities seized, Opportunities missed, Cornell
University Press, Ithaca, NY.
Puymbroeck, RV 2001, Comprehensive legal and judicial
development: Toward an agenda for a just and equitable society
in the 21st century, World Bank, Washington, DC.
Timmer, C (ed.) 1991, Agriculture and the state: Growth,
employment, and poverty in developing countries, Cornell
University Press, Ithaca, NY.
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