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The Impact of Financial InclusionOn Economic Growth InDeveloping Countries: Evidence From Panel Data Analysis
Dalarna University, School of Culture and Society.
2025 (English)Independent thesis Advanced level (degree of Master (One Year)), 10 credits / 15 HE creditsStudent thesis
Abstract [en]

In recent years, financial inclusion has gained a very strong factor of economic growth to reduce inequality, yet significant gaps remain in understanding its multidimensional nature and impact across income groups. This thesis addresses the gap by constructing a comprehensive Financial Inclusion Index (FII) for 47 developing countries, using panel data from the World Bank's Global Findex database for 2014, 2017, and 2021. Employing a two-stage Principal Component Analysis (PCA) methodology, the study captures two essential dimensions of financial inclusion: access and usage of financial services. The findings reveal a positive relationship between financial inclusion and economic growth. Furthermore, it also shows significant disparities in financial inclusion, with low income countries disproportionately facing challenges in access and usage compared to the upper middle-income. Moreover, this study has also used different variables of the access and usage of financial services to better assess their impact on economic growth. The results not only fill a gap in existing literature but also emphasize the important role for policymakers to implement targeted financial inclusion strategies especially in developing countries. By Addressing social challenges, enhancing financial infrastructure, and promoting digital and traditional financial solutions, we can get closer to narrow the financial inclusion gap and driving equitable economic participation.

Place, publisher, year, edition, pages
2025.
Keywords [en]
Financial Inclusion Index, Economic Growth, Panel Data, Principal Component Analysis, Developing Countries.
National Category
Economics
Identifiers
URN: urn:nbn:se:du-50594OAI: oai:DiVA.org:du-50594DiVA, id: diva2:1957523
Subject / course
Economics
Available from: 2025-05-09 Created: 2025-05-09

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1112131415161714 of 65
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • chicago-author-date
  • chicago-note-bibliography
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf