Abstract:
In this paper, we analyse the role of the changing nature of occupational employment and wages in explaining the trend in earnings inequality in Ghana between 2006 and 2017, a period in which there was a substantial transformation of the economy, with workers moving out of agriculture and generally taking more-skilled and less-routine jobs in services, in a context of a stagnant manufacturing sector and an oil-based expansion. We show that there was an initial decline in earnings inequality which is best explained by the fall in the skill premium that followed the expansion of education. This period was followed by a substantial increase in earnings inequality in which the skill premium continued to fall at a slower pace and there was a pro-rich change in the earnings returns to routine tasks performed by workers.
