Financial inclusion and sustainable development: an empirical association

Ozili, Peterson K (2022): Financial inclusion and sustainable development: an empirical association. Published in:

Abstract

This paper investigates the association between financial inclusion and sustainable development in a global context. The findings show that high levels of financial inclusion (in terms of higher commercial bank branches per 100,000 adults) is significantly associated with high levels of sustainable development (in terms of higher electricity production from renewable sources, higher industry productivity, higher adult literacy rate and higher renewable electricity output). Also, higher financial inclusion is significantly associated with low combustible renewables and waste. There is uni-directional granger causality between global interest in sustainable development information and global interest in financial inclusion information particularly in the period after the global financial crisis (GFC) but before the COVID-19 pandemic. The results support global calls for greater financial inclusion and the attainment of the sustainable development goals for the good of all people, the environment and for the planet.

• Item Type: MPRA Paper
• Language: English
• Keywords: financial inclusion, sustainable development goals, access to finance, energy, renewables, adult literacy, industry, electricity, access to finance, unbanked adults, environment, research and development.
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I31 - General Welfare, Well-Being; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q56 - Environment and Development ; Environment and Trade ; Sustainability ; Environmental Accounts and Accounting ; Environmental Equity ; Population Growth

References

Adeola, O., & Evans, O. (2017). Financial inclusion, financial development, and economic diversification in Nigeria. The Journal of Developing Areas, 51(3), 1-15.

Ade’Soyemi, K., Olowofela, O. E., & Yunusa, L. A. (2020). Financial inclusion and sustainable development in Nigeria. Journal of Economics and Management, 39(1), 105-131.

Alaimo, L. S., Ciacci, A., & Ivaldi, E. (2021). Measuring sustainable development by non-aggregative approach. Social Indicators Research, 157(1), 101-122.

Allen, F., Carletti, E., Cull, R., Qian, J. Q., Senbet, L., & Valenzuela, P. (2014). The African financial development and financial inclusion gaps. Journal of African economies, 23(5), 614-642.

Alter, A., & Yontcheva, B. (2015). Financial Inclusion and Development in the CEMAC. International Monetary Fund. Washington DC.

Anarfo, E. B., & Abor, J. Y. (2020). Financial regulation and financial inclusion in Sub-Saharan Africa: Does financial stability play a moderating role? Research in International Business and Finance, 51, 101070.

Anarfo, E. B., Abor, J. Y., Osei, K. A., & Gyeke-Dako, A. (2019). Financial inclusion and financial sector development in Sub-Saharan Africa: A panel VAR approach. International Journal of Managerial Finance, 15(4), 444-463.

Bayar, Y., Ozkaya, M. H., Herta, L., & Gavriletea, M. D. (2021). Financial Development, Financial Inclusion and Primary Energy Use: Evidence from the European Union Transition Economies. Energies, 14(12), 3638.

Cabeza-García, L., Del Brio, E. B., & Oscanoa-Victorio, M. L. (2019, November). Female financial inclusion and its impacts on inclusive economic development. In Women's Studies International Forum (Vol. 77, p. 102300). Pergamon.

Cicchiello, A. F., Kazemikhasragh, A., Monferrá, S., & Girón, A. (2021). Financial inclusion and development in the least developed countries in Asia and Africa. Journal of Innovation and Entrepreneurship, 10(1), 1-13.

Cull, R., Demirguc-Kunt, A., & Morduch, J. (Eds.). (2021). Banking the world: empirical foundations of financial inclusion. MIT Press. Cambridge, Massachusetts.

Dabla-Norris, E., Ji, Y., Townsend, R. M., & Unsal, D. F. (2021). Distinguishing constraints on financial inclusion and their impact on GDP, TFP, and the distribution of income. Journal of Monetary Economics, 117, 1-18.

Dakhlia, S., Diallo, B., & Temimi, A. (2021). Financial inclusion and ethnic development: Evidence from satellite light density at night. Journal of Behavioral and Experimental Finance, 29, 100455.

Grohmann, A., Klühs, T., & Menkhoff, L. (2018). Does financial literacy improve financial inclusion? Cross country evidence. World Development, 111, 84-96.