Distribution of government residential utility stimulus in Ghana: evidence from the COVID-19 intervention

Abstract

AbstractIn the wake of the COVID-19 pandemic, several countries resorted to various levels of lockdown as a panacea for the rampant spread of the virus. However, the imposed lockdown was not without economic challenges, particularly for the poor in developing countries. In response, the government of Ghana unveiled several free social support packages such as free water and electricity services. This study models the behaviour for or against free utility services and further investigates the drivers that explain an individual’s behaviour. Using a survey method and an ordered probit econometric technique, we find evidence that about 71 percent of respondents support free utility services, 14 percent are indifferent, and 15 percent also indicate their disapproval. Furthermore, an ordered probit regression analysis is used to show evidence that educated respondents with higher incomes are less likely to appreciate government-sponsored freebies. Other drivers of such behavioural differences for aggregated and disaggregated free social intervention utility services were further examined.

Keywords

• COVID-19
• government
• social intervention
• water
• electricity
• ordered probit