24-Hour Economy Can Be Driven by Incentives, Not Compulsion – Goosie Tanoh

Introduction

The concept of a 24-hour economy has been a topic of growing interest among policymakers and business leaders worldwide. In Ghana, Presidential Advisor Goosie Tanoh has recently emphasized that fostering a round-the-clock economy should rely on incentives rather than compulsion. This perspective is crucial for understanding how to effectively boost productivity, exports, and employment without imposing rigid mandates on businesses.

Key Points

Background

The idea of a 24-hour economy is not new. Many countries have experimented with policies to extend business hours to maximize economic output and create more jobs. In Ghana, the government under President John Dramani Mahama has prioritized this initiative as part of its broader economic development strategy. The goal is to encourage industries and service providers to operate beyond the standard workday, thereby increasing productivity, exports, and employment opportunities.

However, the challenge lies in how to motivate businesses to adopt this model. While some may argue for strict regulations or mandates, Goosie Tanoh, a key advisor on the 24-hour economy, believes that compulsion is not the answer. Instead, he advocates for a market-driven approach that leverages economic incentives.

Analysis

The Role of Incentives in Economic Policy

Goosie Tanoh’s stance reflects a fundamental principle of economics: businesses respond to incentives. Rather than forcing companies to operate 24/7, the government should focus on creating an environment where extended operations are financially attractive. This could include tax breaks, subsidies, or reduced utility costs for businesses that choose to operate during off-peak hours.

Marginal Cost and Revenue Considerations

Tanoh emphasizes that companies make decisions based on marginal cost and revenue. If the cost of hiring additional staff or running extra shifts is less than the expected revenue, businesses will naturally extend their operations. This economic logic underscores the importance of creating favorable conditions rather than imposing mandates.

The 24-Hour Economy Authority Bill

The recent signing of the 24-Hour Economy Authority Bill into law provides a legal framework for implementing this initiative. The bill aims to coordinate efforts across various sectors, ensuring that the transition to a 24-hour economy is smooth and effective. However, the success of this policy will depend on how well the government can balance regulation with incentives.

Potential Challenges

While incentives are a powerful tool, there are challenges to consider. For instance, not all industries may benefit equally from extended hours. Additionally, there may be concerns about worker welfare, as longer hours could lead to burnout or reduced quality of life. The government will need to address these issues to ensure that the 24-hour economy is sustainable and equitable.

Practical Advice

For Policymakers

1. **Design Targeted Incentives**: Identify sectors that are most likely to benefit from extended hours and tailor incentives accordingly.
2. **Monitor Marginal Costs**: Regularly assess the cost-benefit ratio for businesses to ensure that incentives remain effective.
3. **Engage Stakeholders**: Collaborate with industry leaders, labor unions, and other stakeholders to address concerns and build consensus.

For Businesses

1. **Evaluate Feasibility**: Assess whether extending operations aligns with your business model and customer demand.
2. **Leverage Incentives**: Take advantage of government programs and incentives to offset the costs of extended operations.
3. **Prioritize Worker Welfare**: Ensure that any increase in hours is accompanied by fair compensation and support for employees.

FAQ

Conclusion

The push for a 24-hour economy in Ghana represents a bold step toward economic growth and development. Goosie Tanoh’s emphasis on incentives over compulsion offers a pragmatic approach to achieving this goal. By creating an environment where businesses are motivated to extend their operations, the government can unlock new opportunities for productivity and employment. However, the success of this initiative will depend on careful planning, stakeholder engagement, and a commitment to addressing potential challenges.