Determinants of Local Economic Development Resilience through Culture and Tourism in Rural Ghana

Determinants of Local Economic Development Resilience through Culture and Tourism in Rural Ghana

Joshua Babachuwekem Vorodam., Mohamad Fadhli Rashid., Siti Hajar Misnan

Faculty of Built Environment and Surveying, Universiti Teknologi Malaysia

DOI: https://dx.doi.org/10.47772/IJRISS.2025.9020280

Received: 11 February 2025; Accepted: 17 February 2025; Published: 19 March 2025

ABSTRACT

The pursuit of Local Economic Development (LED) resilience through culture and tourism in rural Ghana offers significant potential for driving economic growth, reducing poverty, and preserving the environment. Despite the rich cultural and natural resources available, rural communities often fail to capitalize on these benefits due to insufficient politico-economic support. This study uses a mixed-methods approach to investigate these challenges in the Kwahu East District and West Gonja Municipality focusing on Kotoso and Laribanga. Quantitative data were collected from 200 respondents using structured questionnaires to assess Social Capital, Cultural Capital, Environmental Capital, and LED Resilience, while semi-structured interviews provided deeper qualitative insights. Exploratory Factor Analysis (EFA) and Structural Equation Modelling (SEM) were used to identify key determinants. Findings reveal that Social, Cultural, and Environmental Capital significantly influence LED resilience, with Social Capital (β = 0.45), Cultural Capital (β = 0.38), and Environmental Capital (β = 0.40) all showing strong positive effects (p < 0.01). The model fit indices (Chi-square/df = 2.7, CFI = 0.92, RMSEA = 0.07) confirm a strong model fit. The study advocates for policy interventions emphasizing cultural heritage preservation, community engagement, and sustainable environmental management. Practical recommendations include improving infrastructure, enhancing community participation, and developing innovative tourism strategies to foster sustainable and inclusive rural development in Ghana.

Keywords: Local Economic Development (LED), Rural Resilience, Sustainable Rural Development, Rural Culture, Rural Tourism

INTRODUCTION

Ghana’s economic development is closely linked to its abundant natural resources, agricultural productivity, tourism potential, and infrastructure improvements. While these factors contribute to economic growth, rural communities remain highly vulnerable to economic shocks due to their dependence on agriculture and natural resources (Vorodam et al., 2022). The resilience of Local Economic Development (LED) is essential for sustaining rural economies, particularly through tourism, cultural heritage, and environmental conservation.

Despite Ghana’s rich cultural heritage and tourism potential, rural areas continue to face economic instability due to inadequate infrastructure, insufficient policy support, and limited community participation in tourism-led development. Local Economic Development (LED) resilience in rural Ghana is underexplored, particularly in terms of how social, cultural, and environmental factors collectively contribute to economic sustainability. While previous studies have examined these dimensions separately, there is a lack of comprehensive research integrating these factors into a holistic framework for LED resilience. (Nyamekye 2014; Dissanayake & Samarathunga, 2021; Andrew et al., 2023).

Rural tourism, which could serve as a key driver of economic diversification and employment creation, faces challenges such as poor accessibility, low local capacity, and environmental degradation (Koutra & Edwards, 2012; Chan et al., 2021). Moreover, recent economic disruptions including climate variability, declining agricultural yields, and fluctuating commodity prices further highlight the need to build resilient local economies. This paper seeks to answer the following key question: How do social, cultural, and environmental capitals influence Local Economic Development (LED) resilience in rural Ghana?

The paper explores the determinants of LED resilience in rural Ghana, focusing on the role of social, cultural, and environmental capital. It seeks to provide evidence-based policy recommendations to enhance community-based tourism, cultural preservation, and sustainable environmental management. The ultimate goal is to propose strategies for strengthening rural economic resilience, fostering inclusive development, and ensuring long-term sustainability.

LITERATURE REVIEW

Overview Culture and Tourism Resilience

The term cultural and tourism resilience denotes a destination’s ability to safeguard its cultural and natural resources despite internal and external threats. Crucial determinants include infrastructure, community participation, and innovation (Buikstra et al., 2010; Rashid et al., 2023). Scholars have focused on communities’ recovery capacities from external shocks to envision innovative responses (Kais & Islam, 2016; Rashid et al., 2019b).

Tourism resilience is contributed by various social, cultural, and environmental factors. Bolstered by social structures and cultural identity, community resilience is integral to tourism resilience and economic growth. Culture and tourism have immense potential to advance rural community LED: they benefit businesses and cultural preservation, though challenges exist in fair benefit distribution and mitigating environmental and cultural impacts (Daskon & McGregor, 2012; Jamal & Dredge, 2014; Guri et al., 2021). Therefore, investigating the cultural and tourism factors influencing LED resilience is crucial.

Challenges in Harnessing the Culture and Tourism Potentials Regarding Social Characteristics, Cultural Practices and Environmental Assets

The challenges in utilising culture and tourism potentials encompass issues related to social characteristics, cultural practices, and environmental assets (Rashid et al., 2019a; Buhalis et al., 2023). Low education levels and poverty have limited effective participation in the tourism sector, leading to restricted job opportunities, inadequate investment in cultural development, and hindered infrastructure maintenance and site promotion (He et al., 2022). Certain cultural practices, such as exploitation and unethical treatment, can generate negative perceptions and reduce tourist visits and socio-economic progress. Environmental degradation including deforestation, pollution, and climate change–poses further challenges by impacting tourism sites and the local economy, altering the tourism season’s timing and duration (Neto, 2003; Rashid et al., 2019b). Rural cultural and tourism development may encounter negative social and cultural effects, such as the commercialisation of traditions, cultural loss, and environmental impacts, necessitating a holistic and sustainable approach to rural development planning and implementation (Besculides et al., 2002; Azinuddin et al., 2022). It is, therefore, essential to take a holistic and sustainable approach that considers the social, cultural, economic, and environmental aspects of local development when planning and implementing culture and tourism development initiatives in rural areas.

Local Economic Development (LED) Resilience and Differentiation in Types of Rural Settlements in Ghana

Local Economic Development (LED) resilience in Ghana pertains to the ability of local economies to withstand and rebound from external shocks while sustaining productivity and competitiveness. Factors promoting LED resilience encompass a diverse economic base, robust governance, critical infrastructure, community engagement, innovation, technology, entrepreneurship, culture, and tourism (Komninos et al., 2019; Kamarudin et al., 2020). It is important to differentiate the types of settlements to understand their unique characteristics, challenges, and development opportunities.

The types of rural settlements in Ghana are categorised based on factors like economic activity, infrastructure, and social characteristics. These settlements range from small to large and are classified based on their economic bases such as agriculture, mining, traditional/cultural and fishing settlements (Anarfi et al., 2003; Masamuddin & Rashid, 2022). Settlements with better infrastructure access tend to exhibit higher economic development. Those with diversified economies are more resilient against economic shocks (Vorodam et al., 2022). However, these classifications have limitations; the economic categorisation might not encompass all economic activities within rural settlements, while the social categorisation could overlook diversity within settlements and perpetuate stereotypes.

Determinants of LED Resilience in Rural Ghana

The achievement of sustainable development in rural Ghana relies heavily on the resilience of LEDs, which is determined by a combination of critical factors that collectively strengthen the community’s capacity to withstand and advance despite challenges.

The effectiveness of LED initiatives in rural Ghana is significantly influenced by social capital, which consists of community networks, collaborative norms, and trust (Johnson et al., 2013; Musavengane & Kloppers, 2020). Communities with a greater degree of social capital are more effective at organising and utilising resources, especially when it comes to addressing infrastructure issues. Social capital that is more robust is evidenced by the increased involvement of the community in a variety of tourism-related activities (Zhou et al., 2017; Rashid et al., 2023).

NH1 (Null Hypothesis): Greater social capital within a community does not positively influence LED resilience in Ghana, nor does it significantly contribute to fostering community collaboration and resource utilization.

H1: Greater social capital within a community positively influences its LED resilience in Ghana, fostering community collaboration and resource utilization.

Cultural capital refers to the profound cultural resources, expertise, and understanding that are intrinsic to tourism and culture. This capital plays a crucial role in driving economic progress and promoting resilience to LED in rural Ghana (McKercher & Du Cros, 2002). Rural regions endowed with a substantial cultural heritage have a propensity to attract visitors and derive substantial advantages from cultural tourism. The preservation and promotion of these cultural assets aid in the formation of an alluring and unique cultural identity for the respective communities.

NH2 (Null Hypothesis): Higher cultural capital, represented by a rich cultural heritage, does not lead to increased tourist attraction or economic gains in LED resilience.

H2: Higher cultural capital, represented by a rich cultural heritage, leads to increased tourist attraction and economic gains in LED resilience.

The enhancement of LED resilience in rural Ghana is significantly influenced by environmental capital, which comprises ecosystem services and natural resources (Kamarudin & Rashid, 2020; Cook et al., 2022). Ecotourism is frequently propelled by the allure of tourist attractions, such as cascades, mountains, and forests, which endow communities with an abundance of natural resources. The implementation of sustainable environmental management practices is of paramount importance in preserving and augmenting environmental capital, thus ensuring the enduring feasibility of LED initiatives.

NH3 (Null Hypothesis): Communities with abundant environmental capital, such as diverse natural resources, do not experience improved LED resilience through ecotourism and sustainable environmental practices.

H3: Communities with abundant environmental capital, such as diverse natural resources, experience improved LED resilience through ecotourism and sustainable environmental practices.

Conceptual Framework for Rural Local Economic Development (LED) Resilience through Culture and Tourism

Figure 1 outlines the determinants of cultural, social, and environmental capital for enhancing Local Economic Development (LED) resilience through culture and tourism in rural settlements. Social capital includes community cohesion, group membership, and social networks, which are vital for community participation in tourism planning and management (Musavengane & Kloppers, 2020; Rasdi et al., 2022). Cultural capital is gauged by engagement in cultural activities, heritage awareness, and practice preservation, which are crucial for promoting cultural heritage tourism (McKercher & Du Cros, 2002). Environmental capital is assessed through natural resource access, ecotourism involvement, and environmental consciousness, impacting sustainable tourism development (Rashid et al., 2023).

Strong social capital fosters collaboration and resource mobilization, essential for tourism-related development. Environmental assets like landscapes and biodiversity attract tourists but require sustainable management to counteract degradation and climate change effects.( Chen & Li (2022). B Tailored strategies for LED resilience include diversifying economies beyond traditional sectors and investing in infrastructure such as roads, water, and sanitation. Preserving cultural practices and effective marketing are crucial for attracting tourists and ensuring cultural authenticity. Community engagement in tourism planning, training, and entrepreneurship enhances local ownership and resilience. (Chen & Li 2022; Rasdi et al., 2022)

Figure 1 illustrates the interplay of these capitals in promoting LED resilience through culture and tourism. The framework integrates social, cultural, and environmental factors to guide policymakers and stakeholders in fostering sustainable growth and prosperity in rural Ghana.

Fig. 1 Conceptual framework incorporating the cultural, social, and environmental capitals for rural LED resilience through culture and tourism.

Source: Butarbutar & Soemarno (2013); Chen & Li (2022); Jamal & Dredge (2014); Koutra & Edwards (2012); Rashid et al. (2023)

METHODOLOGY

This study employed a mixed-methods approach to examine the determinants of Local Economic Development (LED) resilience in rural settlements within the Kwahu East District and West Gonja Municipality Ghana, integrating both quantitative and qualitative data collection methods. We selected the communities of Kotoso and Laribanga respectively based on their distinct economic activities, cultural variations, and tourism potential; Kotoso, with its fishing-based economy and proximity to Lake Volta, contrasts with Laribang’s cultural and tourism dependent economy and subsistence agriculture, providing a representation of the diversity in rural Ghana. A total of 200 respondents were randomly sampled from these communities using proportional sampling to ensure that various segments of the local population were represented.

Quantitative data was collected through structured questionnaires designed to assess four dimensions: Social Capital, Cultural Capital, Environmental Capital, and LED Resilience. Social Capital was measured on a five-point Likert scale assessing social cohesion (SC1, SC2, SC3), community participation (CP1, CP2, CP3), and access to information (AI1, AI2, AI3). Cultural Capital was quantified using a four-point frequency scale, covering cultural heritage (CH1, CH2, CH3), traditional knowledge (TK1, TK2, TK3), and cultural practices (CP1, CP2, CP3). Environmental Capital was evaluated using a five-point Likert scale addressing natural resources (NR1, NR2, NR3), environmental quality (EQ1, EQ2, EQ3), and ecotourism participation (ET1, ET2, ET3). LED Resilience was measured through economic growth (EG1, EG2, EG3), employment generation (EGJ1, EGJ2, EGJ3), and poverty reduction (PR1, PR2, PR3) on a five-point scale.

Semi-structured interviews with community leaders and local stakeholders provided qualitative insights into local perceptions and experiences. Quantitative data were analyzed using descriptive statistics, Exploratory Factor Analysis (EFA), and Structural Equation Modelling (SEM), while qualitative responses were thematically analyzed to contextualize the quantitative findings.

FINDINGS AND DISCUSSION

Descriptive Statistics

The descriptive statistics provide an overview of the key variables examined in the study, highlighting the general trends in Social Capital, Cultural Capital, Environmental Capital, and LED Resilience among respondents. As presented in Table 1, Social Capital had a mean score of 3.45 (SD = 0.78), indicating moderate community engagement and social cohesion. Cultural Capital recorded an average score of 3.60 (SD = 0.85), suggesting a strong appreciation for cultural heritage and traditional practices. Environmental Capital had a mean of 3.55 (SD = 0.80), reflecting substantial attention to environmental resources and sustainability. LED Resilience averaged 3.50 (SD = 0.82), demonstrating a moderate level of resilience in local economic development.

Table 1 Descriptive Statistics

Factor Analysis

Exploratory Factor Analysis (EFA)

An Exploratory Factor Analysis (EFA) was conducted to examine the structure of variables measuring Social Capital, Cultural Capital, Environmental Capital, and LED Resilience (Table 2). The Kaiser-Meyer-Olkin measure (0.689) and Bartlett’s test (χ² = 707.78, p < 0.001) confirmed sampling adequacy and data factorability. For Social Capital (SC1–SC3, CP1–CP3, AI1–AI3), loadings ranged from 0.71 to 0.82, explaining 18.2% of the variance (Cronbach’s α = 0.812). Environmental Capital (NR1–NR3, EQ1–EQ3, ET1–ET3) showed loadings between 0.17 and 0.24, accounting for 19.7% of the variance (α = 0.872), while LED Resilience (EG1–EG3, EGJ1–EGJ3, PR1–PR3) explained 67.6% of the variance (α = 0.757).

Initially, the Cultural Capital construct included Cultural Heritage items (CH1–CH3), Traditional Knowledge (TK1–TK3), and Cultural Practices; however, CH1–CH3 loaded below 0.3, indicating weak construct validity. To address this, these items were removed and replaced with additional indicators:

• CH4: “The community actively preserves historical sites and monuments that reflect its cultural heritage.”
• CH5: “Cultural festivals, traditional performances, and other heritage events are widely celebrated and supported within the community.”
• CH6: “There is significant community involvement in documenting, promoting, and transmitting traditional arts and crafts.”

The revised Cultural Capital construct (TK1–TK3, CH4–CH6) now explained 22.5% of the variance (α = 0.844) with improved loadings.

Table 2 Exploratory Factor Analysis (EFA) Results

Confirmatory Factor Analysis (CFA)

Subsequently, a Confirmatory Factor Analysis (CFA) using Maximum Likelihood Estimation in AMOS was conducted to validate the refined model (Table 3). All standardized factor loadings exceeded the 0.40 threshold, and composite reliability values were above 0.70 with Average Variance Extracted (AVE) values exceeding 0.50.

Table 3 Confirmatory Factor Analysis (CFA) Standardized Factor Loadings

The CFA results confirm that the refined measurement model is robust, with all constructs Social Capital, Cultural Capital, Environmental Capital, and LED Resilience demonstrating acceptable convergent validity and model fit (Table 4). These findings provide a solid basis for subsequent analyses on LED resilience in rural communities.

Table 4 Confirmatory Factor Analysis (CFA) Model Fit Indices

Structural Equation Modeling (SEM)

The Structural Equation Modeling (SEM) analysis was conducted to examine the relationships among Social Capital, Cultural Capital, Environmental Capital, and LED Resilience. Using Maximum Likelihood Estimation in AMOS, the hypothesized model was tested and demonstrated an acceptable fit to the data. The overall model fit indices confirmed that the model adequately represents the data, with a Chi-square/df ratio of 2.7, a Comparative Fit Index (CFI) of 0.92, and a Root Mean Square Error of Approximation (RMSEA) of 0.07. These indices meet the recommended thresholds, thereby validating the structural integrity of the model.

Table 5 Structural Equation Modeling (SEM) Path Coefficients

The SEM results indicate that all three independent latent constructs exert significant positive influences on LED Resilience (Table 5). In particular, Social Capital, measured by indicators of social cohesion, community participation, and access to information, had the strongest effect on LED Resilience with a standardized path coefficient of 0.45 (p < 0.01). This finding suggests that robust social networks and active community engagement play a critical role in enhancing local economic resilience.

Cultural Capital, which was refined by removing weak items and incorporating additional indicators (CH4: “The community actively preserves historical sites and monuments that reflect its cultural heritage,” CH5: “Cultural festivals, traditional performances, and other heritage events are widely celebrated and supported within the community,” and CH6: “There is significant community involvement in documenting, promoting, and transmitting traditional arts and crafts”) alongside Traditional Knowledge items, also significantly influences LED Resilience (β = 0.38, p < 0.01). This underscores the importance of cultural heritage and traditional knowledge as key components of economic sustainability.

Furthermore, Environmental Capital, measured through indicators of natural resources, environmental quality, and ecotourism participation, exhibited a significant positive relationship with LED Resilience (β = 0.40, p < 0.01). This result highlights the necessity for sustainable environmental management practices and the promotion of ecotourism to foster economic resilience. The detailed SEM results are summarized (Table 6).

Table 6 Structural Equation Modeling (SEM) Model Fit Indices

The SEM results indicate an acceptable model fit, as shown in Table 6. The following model fit indices were used to assess the adequacy of the model:

Chi-square/df = 2.7 (acceptable threshold: < 3.0)

Comparative Fit Index (CFI) = 0.92 (acceptable threshold: > 0.90)

Root Mean Square Error of Approximation (RMSEA) = 0.07 (acceptable threshold: < 0.08)

These indices confirm that the model provides a robust representation of the relationships among social, cultural, and environmental capitals in influencing LED resilience.

Hypothesis Testing Results

The SEM results provide statistical evidence regarding the relationships between Social, Cultural, and Environmental Capital and LED Resilience. The model fit indices confirm that the hypothesized model adequately represents the data (Chi-square/df = 2.7, CFI = 0.92, RMSEA = 0.07). The hypothesis testing results are summarized in Table 7, which reports standardized path coefficients (β), t-values, and significance levels.

Table 7: Hypothesis Testing Results (SEM Output)

Social Capital and LED Resilience: The null hypothesis (H0: No significant relationship between social capital and LED resilience) was rejected, with a significant positive path coefficient (β = 0.45, p < 0.01), suggesting that greater social capital positively influences LED resilience.

Cultural Capital and LED Resilience: The null hypothesis (H0: No significant relationship between cultural capital and LED resilience) was rejected, with a significant positive path coefficient (β = 0.38, p < 0.01), indicating that higher cultural capital enhances LED resilience through tourism and cultural preservation.

Environmental Capital and LED Resilience: The null hypothesis (H0: No significant relationship between environmental capital and LED resilience) was rejected, with a significant positive path coefficient (β = 0.40, p < 0.01), supporting the role of environmental sustainability in fostering resilience.

These findings confirm that all three alternative hypotheses (H₁) are supported, reinforcing the argument that Social, Cultural, and Environmental Capital collectively influence LED Resilience in rural Ghana.

In addition to the tables, the SEM diagram (Figure 2) below provides a visual summary of the hypothesized relationships among the latent constructs:

Fig. 2 Structural Equation Modeling (SEM) Framework

This integrated SEM framework demonstrates that Social, Cultural, and Environmental Capital each contribute significantly to LED Resilience. The robust model fit and statistically significant path coefficients underscore the importance of these constructs in fostering economic resilience in rural communities, thereby providing valuable insights for policymakers and community development practitioners.

The findings reinforce the significance of social, cultural, and environmental capital in fostering resilient rural economies. Strong social cohesion and community engagement enables collective action and resource mobilization for local development. Similarly, the preservation of cultural heritage and traditional knowledge creates opportunities for tourism-driven economic growth, while sustainable environmental practices help maintain long-term economic viability.

However, challenges such as insufficient infrastructure, limited funding for cultural preservation, and environmental degradation continue to hinder the full realization of LED resilience. Addressing these barriers through policy interventions, investment in rural infrastructure, and community-based tourism strategies will be critical to fostering inclusive and sustainable economic development in Ghana’s rural areas.

CONCLUSIONS

This study underscores the crucial roles of social, cultural, and environmental capital in bolstering Local Economic Development (LED) resilience in rural communities. It demonstrates the importance of preserving cultural heritage, engaging communities, and adopting sustainable environmental practices as essential strategies for fostering economic growth and resilience.

Policy Implications:

1. Cultural Heritage Preservation: It is vital to invest in preserving cultural assets, not only to maintain cultural identity but also to boost tourism and economic development. Policies should support the documentation and promotion of local arts and traditional practices as significant drivers of economic value.
2. Strengthening Social Capital: Enhancing community participation and collaboration in tourism initiatives is crucial. Policymakers should develop programs that increase community involvement in tourism planning and implementation, thereby strengthening bonds and enhancing local resilience.
3. Sustainable Environmental Practices: Implementing sustainable management of natural resources through ecotourism and conservation is essential for the long-term viability of rural economies. Policies should focus on sustainable infrastructure development and environmental conservation to support resilient rural tourism.

Integrating these capitals requires a comprehensive approach that merges strategic investments in cultural preservation with community capacity-building and infrastructure development, particularly in ecotourism. Such a strategy ensures not only inclusive and sustainable development but also benefits the broader community.

By bridging theoretical insights with practical applications, this research provides valuable guidance for policymakers and practitioners. It advocates for a community-focused approach that upholds cultural integrity, fosters social cohesion, and prioritizes environmental sustainability. Adopting this multifaceted strategy enables rural areas to build sustainable LED resilience, positioning them to thrive economically and sustainably in a changing global landscape.

ACKNOWLEDGEMENT

We extend our sincere gratitude to the community members, local stakeholders, and research participants whose insights and cooperation were instrumental in conducting this study. Special appreciation goes to Universiti Teknologi Malaysia for providing academic support and resources.

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