Nicholas Awuse and Patrick Tandoh-Offin
This study determines how factor analysis can be used to categorize poverty reduction variables, internal migration and to promote development in Ghana. The purpose is to find out which variables accounts for poverty reduction efforts in Ghana especially those that have implications for rural livelihoods. A total of 345 questionnaires from seven regions of Ghana were used to gather data from migrant-concentrated areas. The investigations show that negative or positive correlations carry the same weight. The three key variables emerged as the main cause of internal migration in Ghana. These were, Economic factors, Demographic factors, Social and cultural factors, Geographical and physical factors and Political and institutional factors and welfare and poverty as the main cause of internal migration in Ghana. In recommendation, even though, this method has proven to be successful in explaining poverty reduction techniques, other methods could also be applied as alternative to the factor analysis. Internal migration plays an important role in sharpening peoples’ lives, if not properly managed could be harmful to some extent. Factor analysis method is not good for small sample size for the reasons given above. Likelihood maximum ratio test should always be considered in place of the factor analysis. In conclusion, nine variables were initially put into the computer and a test performed that allowed the nine variables to be reduced to three components namely, welfare, economic and poverty as the basic factors responsible for migration in Ghana. For other areas/regions, migration for a better employment produce labour force shortage and affects the potential of local economic and social development. The internal migration phenomenon is influenced by the economic evolution and open new possibilities for further analysis. Money sent by emigrants to their families is increasing their quality of life and has positive effects on the family relations.