DOES FINANCIAL DEVELOPMENT MATTER IN POVERTY REDUCTION? EMPIRICAL EVIDENCE FROM SOUTH ASIAN ECONOMIES

Wenqin Ma ()
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Wenqin Ma: School of Management, University of Science and Technology of China, Hefei, P. R. China

The Singapore Economic Review (SER), 2023, vol. 68, issue 04, 1207-1230

Abstract: This study looked at the possibility that South Asian countries’ financial prosperity may lessen poverty. The data presented in this research show that between 1990 and 2019, economic development directly led to a decline in poverty in South Asian nations. Remittances reduce poverty, but financial growth has a huge influence. The model result suggests that financial development strongly affects poverty reduction, regardless of the econometric methodology. The results demonstrated that whereas remittances increase poverty levels for men and women, economic development significantly reduces them. Poverty was decreased considerably by variables such as economic development, foreign direct investment and commercial openness. As a result of these expenditures, the South Asian population was shown to be more vulnerable to poverty. The South Asian population was more susceptible to poverty due to these outlays. The results also refute earlier research suggesting that rising poverty may result from financial instability.

Keywords: Financial development; poverty reductions; remittances; South Asia; econometric approaches (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1142/S0217590822440088

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