The study of economic life in Africa can be characterised by two main approaches: those concerned with developing formal economic models based on macroeconomic variables, and those interested in the study of economic behaviours and practices of ordinary Africans. This volume brings together a collection of eighteen papers that typify the first approach and mainly depend on advanced statistical modelling of survey data, notably the Ghana Living Standards Survey. There are three important problems associated with this approach in the Ghanaian context. First, the volume omits the informal sector. Instead, formal economic problems take centre stage, such as the relation between fiscal policies and the exchange rate, trade reforms and firm performance, and macro-financial interventions and savings. Common conclusions include: ‘private sector reforms in Ghana have not boosted firm development in Ghana' (p. 134)’, or: ‘monetary policies relying on interest rates may not work in Ghana’ (p. 107).

These findings are perhaps not so surprising: following structural adjustment, the Ghanaian government retrenched economically (a SAP condition), a large and vibrant domestic informal sector emerged (conservatively estimated at 38·4% of Ghana's GDP in 2000), and remittances from overseas migrants picked up dramatically (estimated at more than US$1·5 billion in 2004). These processes reduce the significance of the formal sector, and thus compromise the explanatory power of formal models, a point that the contributors hardly address.

Second, the collection considers the Ghanaian economy in isolation from the West African region. The volume tends to adopt Ghana's national borders as the boundaries for its models. Yet the casual visitor to Ghana will readily note the significance of the road running along West Africa's coast, connecting Accra and other Ghanaian towns with the neighbouring settlements of West Africa's forest zone. That road is daily packed with large number of vehicles and busses, typically carrying a mix of passengers and goods which demonstrate its significance for Ghana's economy. Likewise, the main road going north is crucial in maintaining trade relations with West Africa's savannah region, and Ghana shares long and dynamic borders with Côte d'Ivoire and Togo. Consequently, Ghana's economy is not an autonomous system, but is embedded in a framework of (mainly informal) cross-border trade, a point that the volume does not explore beyond a few occasional remarks.

Finally, The Economy of Ghana expresses a debatable belief in the calculating actor. The volume views economic actors as rational individuals, driven by price incentives. In the case of savings, for instance, the book records that between 1991–2 and 1998–9 inflation decreased (p. 279) and the interest rate remained constant (p. 79). Reasoning from the standpoint of the calculating actor, one would have expected an increasing proportion of the Ghanaian population to hold a savings account. However, during the 1990s this proportion remained stable (p. 169). The authors infer from this an inherent inertia within the financial system, in other words, that it lacked the necessary incentives to change the behaviour of individuals. But they do not explore a rival explanation: Ghanaians have a low confidence in their banking system and/or have weak expectations of Ghana's financial future, and therefore shun savings. Considering the impact of the broader political, social and economic expectations of ordinary Ghanaians in the analysis could have helped to shed greater light on actual economic decision-making.

In conclusion, the volume presents a form of economic analysis that will be of interest for the specialist reader familiar with the statistical models that most of the chapters rely on. For those interested in Ghana's real economy there may be a number of more useful contributions to consult – some of which have been reviewed in earlier issues of this journal.