The effect of financial deepening on inequality: Some international evidence

Shigeyuki Hamori and Yoshihiro Hashiguchi

Journal of Asian Economics, 2012, vol. 23, issue 4, 353-359

Abstract: This paper uses an unbalanced panel data analysis of 126 countries for the period 1963–2002 to analyze the effects of financial deepening on inequality. The principal findings can be summarized as follows: (1) financial deepening reduces inequality; (2) economic growth reduces the equalizing effects of financial deepening; (3) inequality increases with an increase in trade openness; (4) the disequalizing effects of trade openness decrease as a country grows; (5) financial deepening and trade openness therefore have asymmetric effects on inequality; and (6) these effects are robust to the choice of financial variables, inequality measures, and model specifications.

Keywords: Financial deepening; Inequality; Equalizing effect; Dynamic GMM (search for similar items in EconPapers)
JEL-codes: D6 E5 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (62)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:asieco:v:23:y:2012:i:4:p:353-359

DOI: 10.1016/j.asieco.2011.12.001

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