Economist Dr Evans Nunoo has cautioned that Ghana’s improved macroeconomic indicators, including lower inflation, will not translate into better living conditions for ordinary citizens unless incomes rise across the board.
Speaking on Starr FM’s Morning Star on Thursday, November 12, 2026, Dr Nunoo addressed widespread public complaints that the economy looks better on paper but people are not feeling the gains in their pockets, on the streets or in the markets.
He stressed the need to distinguish between inflation and the cost of living.
Inflation measures changes in the general price level, he explained, but whether people feel better off depends on the relationship between those prices and their incomes.
“The general price level and how much income comes to you should inform you whether you are feeling it in their pocket or not,” Dr Nunoo said.
“Obviously, I am not too comfortable when we try to justify or when we try to answer those who say that they are not feeling the gains in their pocket with inflation, because inflation would obviously measure how prices change, but the reality is that income levels will determine whether people are feeling right or not.”
Using simple illustrations, he noted that stable prices mean little if household incomes remain too low to cover basic needs. Even when prices stop rising, people will continue to complain about the cost of living if their earnings have not increased.
Dr Nunoo argued that the government must, therefore, prioritise measures that raise incomes.
The most effective route, he said, is to boost domestic economic activity so that more jobs are created and more buying and selling takes place within the local economy.
“That, the best way to do that is to boost economic activities in the sector, so that there will be more jobs, there will be more buying and selling…so that people will hold money in their pockets and they can meet their demands, and the gap between the price level and the income levels will be reduced. Otherwise, they will keep complaining,” he stated.
He warned that simply reducing inflation from previously high levels would not automatically restore the link between prices and incomes if salaries and earnings had not kept pace during the earlier period of high price rises.
Source: Starrfm.com.gh
