Reaching out to the unbanked: the role of political ideology in financial inclusion

Abe de Jong; Abu Zafar Shahriar; Farhan Shazia

doi:10.1016/j.jimonfin.2022.102678

Reaching out to the unbanked: the role of political ideology in financial inclusion

Abe de Jong, Abu Zafar Shahriar, Farhan Shazia

Banking & Finance

Research output: Contribution to journal › Article › Research › peer-review

5 Citations (Scopus)

Abstract

This paper studies the effect of political ideology on household financial inclusion. Financial inclusion is the access to formal financial services and provides an entry key for people to participate in the economy. Using granular data of 65 countries, we find that financial inclusion is higher under right-wing regimes than under left-wing governments. We use regression discontinuity design and propensity-score matching to address endogeneity issues. We investigate multiple channels for the effect and conclude that right-wing market-oriented policies are more successful in enhancing financial inclusion than left-wing societal policies.

Original language	English
Article number	102678
Number of pages	27
Journal	Journal of International Money and Finance
Volume	126
DOIs	https://doi.org/10.1016/j.jimonfin.2022.102678
Publication status	Published - Sept 2022

Keywords

Financial inclusion
Government ideology
Mobile banking
Political ideology

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1016/j.jimonfin.2022.102678

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title = "Reaching out to the unbanked: the role of political ideology in financial inclusion",

abstract = "This paper studies the effect of political ideology on household financial inclusion. Financial inclusion is the access to formal financial services and provides an entry key for people to participate in the economy. Using granular data of 65 countries, we find that financial inclusion is higher under right-wing regimes than under left-wing governments. We use regression discontinuity design and propensity-score matching to address endogeneity issues. We investigate multiple channels for the effect and conclude that right-wing market-oriented policies are more successful in enhancing financial inclusion than left-wing societal policies.",

keywords = "Financial inclusion, Government ideology, Mobile banking, Political ideology",

author = "{de Jong}, Abe and Shahriar, {Abu Zafar} and Farhan Shazia",

note = "Funding Information: ☆ ☆The authors thank two anonymous reviewers, Zhe An, Galina Borisova Hale, Tony Cavoli (discussant), Silvio Contessi, Fangjian Fu, Zhiguo He, Niels Hermes, Brett Inder, Peta Mills, Hassan Naqvi, Hoa Nguyen (discussant), Yoshio Nozawa, Buhui Qiu, Kasper Roszbach (the editor), Xiaoyun Yu, and participants of the Finance, Property, Technology and the Economy Conference (2019) and the Australasian AID Conference (2020) for helpful comments. This work was not supported by a specific grant from funding agencies in the public, commercial, or not-for-profit sectors. Publisher Copyright: {\textcopyright} 2022 Elsevier Ltd",

year = "2022",

month = sep,

doi = "10.1016/j.jimonfin.2022.102678",

language = "English",

volume = "126",

journal = "Journal of International Money and Finance",

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T2 - the role of political ideology in financial inclusion

AU - de Jong, Abe

AU - Shahriar, Abu Zafar

AU - Shazia, Farhan

N1 - Funding Information: ☆ ☆The authors thank two anonymous reviewers, Zhe An, Galina Borisova Hale, Tony Cavoli (discussant), Silvio Contessi, Fangjian Fu, Zhiguo He, Niels Hermes, Brett Inder, Peta Mills, Hassan Naqvi, Hoa Nguyen (discussant), Yoshio Nozawa, Buhui Qiu, Kasper Roszbach (the editor), Xiaoyun Yu, and participants of the Finance, Property, Technology and the Economy Conference (2019) and the Australasian AID Conference (2020) for helpful comments. This work was not supported by a specific grant from funding agencies in the public, commercial, or not-for-profit sectors. Publisher Copyright: © 2022 Elsevier Ltd

PY - 2022/9

Y1 - 2022/9

N2 - This paper studies the effect of political ideology on household financial inclusion. Financial inclusion is the access to formal financial services and provides an entry key for people to participate in the economy. Using granular data of 65 countries, we find that financial inclusion is higher under right-wing regimes than under left-wing governments. We use regression discontinuity design and propensity-score matching to address endogeneity issues. We investigate multiple channels for the effect and conclude that right-wing market-oriented policies are more successful in enhancing financial inclusion than left-wing societal policies.

AB - This paper studies the effect of political ideology on household financial inclusion. Financial inclusion is the access to formal financial services and provides an entry key for people to participate in the economy. Using granular data of 65 countries, we find that financial inclusion is higher under right-wing regimes than under left-wing governments. We use regression discontinuity design and propensity-score matching to address endogeneity issues. We investigate multiple channels for the effect and conclude that right-wing market-oriented policies are more successful in enhancing financial inclusion than left-wing societal policies.

KW - Financial inclusion

KW - Government ideology

KW - Mobile banking

KW - Political ideology

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DO - 10.1016/j.jimonfin.2022.102678

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SN - 0261-5606

VL - 126

JO - Journal of International Money and Finance

JF - Journal of International Money and Finance

M1 - 102678

ER -

Reaching out to the unbanked: the role of political ideology in financial inclusion

Abstract

Keywords

UN SDGs

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