Inflation's Uneven Tax

A 2014 Toyota Vitz on Jiji in Accra today lists at a median of around GH₵120,000.¹ In January 2022 the same model year sold for roughly GH₵110,000. Four years flat in cedi terms. In dollars, a used Toyota held its ground while the currency lost forty percent of its value at the trough and recovered partway.²

The cedi, over the same period, did not hold. Ghana's headline inflation ran at 31 percent in 2022, 38 percent in 2023, 23 percent in 2024.³ A household that left GH₵110,000 in a savings account in January 2022 could, at the 2024 low point, import about $7,600 worth of goods. A household that converted the same GH₵110,000 into a used Vitz could import about $9,000 worth of goods. The car was also earning GH₵200 to GH₵600 a day on Bolt or Yango while the currency collapsed around it.

Ghana is the stage. The mechanism runs anywhere a currency depreciates faster than the economy grows, which is most of the emerging world.

The urban ladder

The Vitz is one rung. The pattern repeats across productive assets in Accra.

A Bajaj Boxer or a Honda 150cc commercial motorcycle cost roughly GH₵8,000 in early 2022 and about GH₵15,000 today. In dollars, $960 to around $1,400. It throws off GH₵150 to GH₵200 a day in Accra, more in the north.

A residential plot in Kasoa traded near $4,000 in 2022. The same plot now lists at $10,000 to $11,000, two and a half times in dollar terms during a period when holding cedis lost you forty percent.⁴ Property pages on Meqasa and Quao Realty list Greater Accra land in US dollars by default, with a cedi conversion shown in parentheses. The currency has already lost its denomination function at the top of the ladder.

Each rung up trades cashflow for durability. The bike earns more per dollar than the car. The car earns more per dollar than the land. The land appreciates more per dollar than either.

Normal depreciation math says an eight-to-twelve-year-old Toyota should lose three to seven percent of its dollar value every year. The Vitz in Accra did not. It is priced against the cost of importing its replacement, and that cost moves with the dollar, not the cedi. The same logic runs through every imported durable. Generators, refrigerators, welding kits, milling machines. A productive asset in a soft-currency economy doubles as a dollar-denominated savings vehicle that happens to generate cash.

When the pattern breaks

The urban ladder does not translate to the farm cleanly.

Cocoa held. The Ghana Cocoa Board pays farmers a fixed farmgate price set by COCOBOD. In 2022 that was GH₵800 per 64-kilogram bag. By April 2024 it had been raised to GH₵3,100. A year later, GH₵3,625.⁵ At peak this was about $270 a bag, up from $96 four years earlier. A smallholder with four bags per acre grossed around $380 per acre in 2022 and close to $960 at the peak. Two and a half times in dollar terms. COCOBOD did not act out of generosity. They raised the price to stop farmers from smuggling to Côte d'Ivoire at the world price, which briefly touched $11,000 a tonne in early 2024. In February 2026, with world prices softening, COCOBOD cut the farmgate back to GH₵2,587. Cocoa is a store of value, but one mediated by the state and capped at whatever fraction of the world price the regulator can afford to pass through.

Cattle broke. A mature cow in Tamale or Bolgatanga traded between GH₵8,000 and GH₵15,000 in 2022, roughly $960 to $1,800. Through the cedi crash of 2022-2024 prices rose in cedis but fell in dollars, because the cross-border trade with Burkina Faso and Niger set a CFA-denominated floor the cedi kept falling below. When the cedi recovered in 2025, dealers explicitly quoted cattle that had been GH₵20,000 the year before at GH₵15,000.⁶ Rural households holding cattle were not protected the way urban households holding cars were.

The rural data sharpens the test. A hard-currency tether is what stores value in a soft-currency economy. Productivity alone does not. Cars are imports priced in USD replacement cost. Land is finite and increasingly USD-quoted. Cocoa is a world commodity passed through a state filter. Cattle is a regional, consumption-oriented asset with no hard-currency anchor. The first three hold. The fourth does not.

The rung you cannot leave

The inflation tax falls hardest on the people with no way up the ladder.

A Vitz is GH₵110,000. A Kasoa plot is GH₵125,000. A motorcycle at GH₵15,000 is more reachable, but even that is half a year of median informal-sector income after fuel, rent, and food. The financing that would let a household climb the ladder barely exists. No credit score. No revolving card. No lease-to-own product at household scale that does not charge predatory rates. The financing loop works for fleet transport because banks can lend against platform data. It stops at the company level. The individual driver buying his first car has no on-ramp. The $9.3 trillion in dead capital de Soto documented is the ladder's missing rungs made visible.

So most people earn in cedis, spend in cedis, and save in cedis because there is nothing else they can reach. The 31 percent inflation of 2022, the 38 percent of 2023, the 23 percent of 2024. Those rates land entirely on their purchasing power. The people who had already climbed to rung two or three absorbed the same shock with a car that generated daily cedis they could spend before prices moved again, or with land that appreciated faster than the currency fell.

Cedi cost, dollar revenue

Rung four is the builder. The person who turns cedi labor into a dollar asset by constructing it himself.

Walk through Kasoa, East Legon, Prampram, any of the arcs of new construction around Accra. The developer buys an unserviced plot in cedis. He contracts local masons, local steel suppliers, local tile traders. All paid in cedis. Over twelve to twenty-four months of construction the cedi slides. The cost base shrinks in dollar terms. The finished unit is priced in dollars. Roughly $100,000 for a two-bedroom in Prampram, over $200,000 in a gated estate off the Spintex road. The buyer is often a member of the diaspora wiring from London, New York, or Dubai. The cedi price is shown as a conversion, not as the primary quote.

Two trades compound. The first is FX arbitrage. Costs in cedis, revenue in dollars. Every point of cedi weakness is margin. The second, larger trade is land appreciation. The same Kasoa plot that cost $4,000 in 2022 exits a finished development with a land-value component closer to $15,000. The developer captures the urbanization rent the state does not price. The new roads, the new schools, the density itself. The density dividend Lagos and Accra are generating is collected by the person with enough capital to buy the plot early and enough organizational capacity to finish a building on it.

Piketty's r greater than g, the return on capital outpacing the growth of the wider economy, is the developed-world version of this. In a soft-currency emerging market the gap widens from a few percentage points to multiples, compounded by FX and urbanization at once. A household earning wages indexed loosely to cedi inflation falls behind a capital owner whose asset base sits in dollars and is tethered to land appreciating faster than any wage in the country.

The three tiers

The specifics change. The currency, the crop, the vehicle class. The shape does not. Soft-currency economy. Tethered assets and untethered ones. The gap widens between households holding paper and households holding what the paper no longer buys.

The wealth question in these economies is not only how much you earn but where your earnings sit after you have earned them. For the majority it is consumption. Fuel, rent, food, at an inflationary rate that never pauses. For the ones escaping, it is a productive asset that tethers to hard currency and throws off daily cedis to live on. For the sophisticated, it is a position built on the gap between cedi costs and dollar revenues, compounded by urbanization pricing the land underneath.

Inflation looks flat. What you pay depends on your rung.