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The impact of financial inclusion on rural food security experience: a perspective from low-and middle-income countries

Renata Baborska, Emilio Hernandez-Hernandez (), Emiliano Magrini () and Cristian Morales-Opazo

MPRA Paper from University Library of Munich, Germany

Abstract: The paper analyses the impact of using single, combinations and the range of three different formal financial services – savings, credit and payments – on the personal food security experience in rural areas across 88 low-and middle-income countries. It takes advantage of Global Findex database and Food Insecurity Experience Scale (FIES) – both included in the 2014-round of Gallup World Poll that collects data at individual-level and comparable worldwide. Our outcome variable of interest is the individual’s probability of experiencing food insecurity related to difficulties in access to food and which we measure through FIES. Econometrically, we employ different matching techniques: entropy balancing, matching on propensity scores and fully interacting linear matching in order to assess the consistency of estimated impacts. The results indicate mixed food security effects depending on the type of service used. Use of savings accounts significantly decreases, use of credit significantly increases and use of formal payment services has no effect on the individual’s probability of experiencing food insecurity. Our findings are consistent with the view that the specific features rather than the range of services offered by formal financial sector is determinative in the final food security experience, especially when they can be assigned to positive income effects.

Keywords: Financial inclusion; experience-based food insecurity scale; rural populations; low-and middle-income countries; impact; entropy balancing (search for similar items in EconPapers)
JEL-codes: O12 Q18 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-agr, nep-fdg, nep-fle, nep-mfd and nep-pay
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