Technological change, completeness of financing microstructures, and impact on well-being and income inequality

Koffi Sodokin (), Joseph Kokouvi Djafon, Yevessé Dandonougbo, Afi Akakpo, Mawuli K. Couchoro and Akoété Ega Agbodji

Telecommunications Policy, 2023, vol. 47, issue 6

Abstract: Financing microstructures are increasingly recognized as critical for promoting financial inclusion and improving overall well-being in developing countries. In practice, the digital transformation in finance has the potential to accelerate the optimal functioning of financing microstructures, including households' access to microfinance and microinsurance. Increased access to finance can lead to a reduction in income inequality and overall well-being for households. This paper investigates the impact of access to digital finance and financing microstructures on household well-being and the reduction of income inequality. To achieve this, we use a combination of propensity score matching, double difference, and smooth instrumental quantile regression as estimation methods with two periods of survey data. Specifically, the paper uses the FinScope consumer data (2016) and the Harmonized Living Standards Measurement Study (2018) from Togo in a comparative perspective. The results suggest that access to both digital finance and financing microstructure is a cultural game-changer that significantly improves overall household well-being and contributes to reducing income inequality.

Keywords: Financing microstructures; Microinsurance; Microfinance; Digital finance; Well-being; Income inequality (search for similar items in EconPapers)
JEL-codes: E2 E21 G2 O55 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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DOI: 10.1016/j.telpol.2023.102571

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