Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 19, 2018 erstellt
Description:
This paper introduces a new index of financial inclusion for 151 economies using principal component analysis to compute weights for aggregating 9 indicators of access, availability, and usage. Using the index, this paper investigates factors influencing financial inclusion. The results show that while higher output growth significantly covaries with greater financial inclusion for high and middle low-income economies, financial sector development and policies promoting financial inclusion play an important role in improving financial inclusion for low income economies. It then assesses the impact of financial inclusion on poverty, income inequality, higher entrepreneurship, and higher female empowerment. Using a cross-sectional approach, the results provide robust evidence that economies with high financial inclusion have significantly lower poverty rates, higher entrepreneurship, and higher female empowerment. However, the impacts of financial inclusion on poverty and other social goals are heterogeneous across country income groups, with the unit increase in financial inclusion associated with the largest reduction in poverty for low income economies