The Role of Financial Development in Reducing Income Inequality in Selected Asian Countries

Yujue Wang (), Nur Syazwani Mazlan (), Wan Azman Saini Wan Ngah () and Muhammad Faheem ()
Additional contact information
Yujue Wang: Universiti Putra Malaysia, Selangor Darul Ehsan, Malaysia, Postal: Universiti Putra Malaysia; 43400 UPM Serdang; Selangor, Darul Ehsan; Malaysia
Nur Syazwani Mazlan: Universiti Putra Malaysia, Selangor Darul Ehsan, Malaysia, Postal: Universiti Putra Malaysia; 43400 UPM Serdang; Selangor, Darul Ehsan; Malaysia
Wan Azman Saini Wan Ngah: Universiti Putra Malaysia, Selangor Darul Ehsan, Malaysia, Postal: Universiti Putra Malaysia; 43400 UPM Serdang; Selangor, Darul Ehsan; Malaysia
Muhammad Faheem: Bahauddin Zakariya University, Multan, Pakistan

Journal of Economic Integration, 2024, vol. 39, issue 3, 622-645

Abstract: The present study investigated the effects of financial development on income inequality for three income level groups across 12 Asian countries (areas) from 1980-2020. The three groups comprised countries with low, moderate, and high economic development. Using the Quantile-on-Quantile (QQ) approach, The findings showed that the impact of financial development on income inequality differed across the income level groups of the 12 selected Asian countries. The results suggested that financial development exacerbated income inequality in underdeveloped countries, while for moderately developed countries, financial development promoted income equality. Except for South Korea, the other countries in the high economic development group showed that financial development exacerbated income inequality. Therefore, the impact of financial development on income should be examined by groups, in which moderately-developed countries could devote more attention to promoting income equality through reforms focusing on the development of financial diversification and the enhancement of financial depth.

Keywords: financial development; income inequality; GINI; QQR (search for similar items in EconPapers)
JEL-codes: G10 G20 O15 O40 O53 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.e-jei.org Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:integr:0914

Access Statistics for this article

Journal of Economic Integration is currently edited by Seongeun Kim

More articles in Journal of Economic Integration from Center for Economic Integration, Sejong University Contact information at EDIRC.
Bibliographic data for series maintained by Yunhoe Kim ().