THE IMPACT OF FINANCIAL INCLUSION ON POVERTY AND INCOME INEQUALITY IN DEVELOPING COUNTRIES

2020 ◽  
Author(s):  
Патимат Султановна Батаева ◽  
Ахмед Магомедович Гачаев
Keyword(s):  
Developing Countries ◽  
Income Inequality ◽  
Social Inclusion ◽  
Financial Inclusion ◽  
The Impact ◽  
Opening Up

Финансовая доступность - ключевой элемент социальной интеграции, особенно полезный в борьбе с бедностью и неравенством доходов, открывающая во многом возможности для обездоленных слоев населения. Статья направлена на изучение влияния финансовой доступности на сокращение бедности и неравенства доходов, а также их детерминант и условных эффектов в развивающихся странах. Financial inclusion is a key element of social inclusion, especially useful in the fight against poverty and income inequality, opening up many opportunities for the disadvantaged. The article aims to study the impact of financial inclusion on the reduction of poverty and income inequality, as well as their determinants and contingent effects in developing countries.

The effects of debt restructurings on income inequality in the developing world

2021 ◽  
pp. 135406612110014
Author(s):  
Glen Biglaiser ◽  
Ronald J. McGauvran
Keyword(s):  
Developing Countries ◽  
Panel Data ◽  
Income Inequality ◽  
Income Distribution ◽  
Government Spending ◽  
Tax Reform ◽  
Social Spending ◽  
The Poor ◽  
The Rich ◽  
The Impact

Developing countries, saddled with debts, often prefer investors absorb losses through debt restructurings. By not making full repayments, debtor governments could increase social spending, serving poorer constituents, and, in turn, lowering income inequality. Alternatively, debtor governments could reduce taxes and cut government spending, bolstering the assets of the rich at the expense of the poor. Using panel data for 71 developing countries from 1986 to 2016, we assess the effects of debt restructurings on societal income distribution. Specifically, we study the impact of debt restructurings on social spending, tax reform, and income inequality. We find that countries receiving debt restructurings tend to use their newly acquired economic flexibility to reduce taxes and lower social spending, worsening income inequality. The results are also robust to different model specifications. Our study contributes to the globalization and the poor debate, suggesting the economic harm caused to the less well-off following debt restructurings.

IMPACTS OF FINANCIAL INCLUSION ON POVERTY AND INCOME INEQUALITY IN DEVELOPING ASIA

2021 ◽  
pp. 1-17
Author(s):  
WARATTAYA CHINNAKUM
Keyword(s):  
Developing Countries ◽  
Income Inequality ◽  
Low Income ◽  
Financial Services ◽  
Trade Openness ◽  
Generalized Method Of Moments ◽  
Principal Component ◽  
Financial Inclusion ◽  
Poor Households ◽  
Low Income Groups

This study investigates the impacts of financial inclusion on poverty and income inequality in 27 developing countries in Asia during 2004–2019 based on a composite financial inclusion index (FII) constructed using principal component analysis (PCA). The generalized method of moments (GMM) was employed for the estimation. The results show that financial inclusion can influence the reduction in both poverty and income inequality. The empirical findings also reveal the contribution of such control variables as economic growth in decreasing income disparity and trade openness in helping improve the standard of living of poor households despite its tendency to co-vary with income inequality. The present empirical evidence supporting the role of financial inclusion in reducing poverty and income inequality in developing countries has led to a policy implication that financial sector development should focus on the availability, usage, and depth of credit to cover all poor households or low-income groups to help improve their access to financial services, enable them to increase their income, and reduce the income gap between poor and rich households.

scholarly journals Revisiting the Impact of Mobile Banking in Financial Inclusion Among the Developing Countries

2021 ◽  
Vol 12 (2) ◽  
pp. 62
Author(s):  
Ummahani Akter ◽  
S. M. Rakibul Anwar ◽  
Riduanul Mustafa ◽  
Zulfiqure Ali
Keyword(s):  
Developing Countries ◽  
Financial Services ◽  
Bandwidth Allocation ◽  
Financial Inclusion ◽  
Three Dimensions ◽  
Future Research ◽  
Mobile Banking ◽  
Innovative Strategies ◽  
Financial Products ◽  
The Impact

Financial inclusion ensures financial products and services at reasonable rates for individuals and aims to introduce unbanked people into banking and financial services. The study aims to explore the effect that mobile banking facilities have on financial inclusion in 17 developing countries. From 2011 to 2017, this study took data from the three dimensions of financial inclusion called "Penetration," "Access," and "Uses". This paper took the Sarma model of Index of Financial Inclusion (IFI) to measure financial inclusion. This paper incorporates mobile money accounts as a "penetration" variable and Mobile banking outlet as an "Access" variable with existing model variables to quantify the effect of mobile banking. This research finds that mobile banking positively impacts the selected countries, though the degree of the changes is not symmetric. African regional countries have improved their financial inclusion after introducing mobile banking much better compared to other regions. This study is limited to examining mobile banking effects on selected emerging countries only. Future research may be devoted to developing more innovative strategies and tools to reach out to unbanked people, including people who face disparities in mobile phone ownership and bandwidth allocation.

Do government expenditure reduce income inequality: evidence from developing and developed countries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Noor Zahirah Mohd Sidek
Keyword(s):  
Developing Countries ◽  
Income Inequality ◽  
Driving Forces ◽  
Government Expenditure ◽  
Developed Countries ◽  
Policy Implications ◽  
Content Type ◽  
Positive Effects ◽  
The Impact ◽  
Developing And Developed Countries

Purpose This paper aims to re-examine the impact of government expenditure on income inequality. Existing studies provide mixed results on whether government expenditure reduces or increases income inequality. In this paper, government expenditure is viewed as a tool for redistribution, hence, its impact on inequality is examined. Design/methodology/approach A sample of 122 countries with 91 and 31 countries categorized as developing and developed countries is used. The dynamic panel threshold regression is used to examine the impact of government expenditure on income inequality and to estimate the turning point of the negative or positive effects. Findings The major findings suggest that, in general, government expenditure does reduce income inequality. Results from developed countries support the inversed U-shaped Kuznet curve where higher government expenditure initially led to more inequality but would eventually bring about a positive effect after a certain threshold level. For developing countries, education and development expenditure were the driving forces towards lower income inequality. Practical implications Several policy implications can be derived from this paper. First, government expenditure is a useful tool to alleviate the problem of income inequality. More integration with the global economy via trading activities is also an important channel to help reduce income inequality. Finally, better institutional quality provides an effective ecosystem in promoting better redistribution of income via government expenditure. Originality/value This paper presents a maiden attempt to estimate a threshold value or when government expenditure starts to reduce or increase income inequality. The sample is segregated into developed and developing countries to further control the effect of government size and the level of development of a country.

THE IMPACTS OF GLOBALIZATION ON THE LABOR SHARE: EVIDENCE FROM ASIA

2020 ◽  
Vol 65 (supp01) ◽  
pp. 57-73
Author(s):  
XIAOSHAN HU ◽  
GUANGHUA WAN ◽  
JING WANG
Keyword(s):  
Developing Countries ◽  
Panel Data ◽  
Income Inequality ◽  
World Wide ◽  
Trade Openness ◽  
Labor Income ◽  
Significant Determinant ◽  
Outward Fdi ◽  
Labor Share ◽  
The Impact

The decline in the share of labor income — an indicator of functional income distribution — has contributed to rising income inequality world-wide. Despite a growing literature, little is known about the effects of globalization on the labor share or inequality in Asia where some of the economies are most globalized. Applying fixed-effect regressions to panel data from 29 Asian economies over the period from 1980 to 2014, we focus on the impacts of globalization on the labor share in Asia where globalization is measured by trade openness and FDI. The modeling results show that trade openness is a significant determinant of the labor share. More specifically, the impact of export is significantly negative and the impact of import is positive. In terms of FDI, the coefficient of the inward FDI is significantly positive and that of the outward FDI is significantly negative in developing countries only.

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