Financial inclusion and inequality: A cross-country analysis. Issue 8 (16th November 2020)

• Record Type: Journal Article
• Authors: Fouejieu, Armand; Sahay, Ratna; Cihak, Martin; Chen, Shiyuan
• Is Part Of: Journal of international trade & economic development. Volume 29:Issue 8(2020)
• Page Start: 1018
• Page End: 1048
• Publication Date: 2020-11-16
• Subjects: Financial inclusion -- inequality -- nonlinearities; E24 -- H23 -- H53 -- H55 -- I32 -- I38 -- O15; International trade -- Periodicals; Economic development -- Periodicals; 337
• DOI: 10.1080/09638199.2020.1785532
• Languages: English
• ISSNs: 0963-8199

Abstract

Abstract : In the context of increasing economic inequality, linkages between finance and the distribution of wealth and income have attracted considerable attention. This paper examines the relationships between access to and use of financial services – financial inclusion – and economic inequality. Building on new dataset on availability and use of financial services, the analysis provides empirical estimates of the impact of financial inclusion on inequality, and explores potential nonlinearities in this relationship by highlighting the role of the prevailing macroeconomic and financial conditions. The paper also sheds light on financial inclusion gender gaps and investigates how disproportionate exclusion of women from usage of financial services affects income inequality. Finally, the study provides proxies for measuring extreme inequality, and examines the linkages between those variables and financial inclusion.