Financial Channels, Property Rights, and Poverty
Financial Channels, Property Rights, and Poverty
Studies on the link between financial development and poverty have been inconclusive. Some claim that deeper financial sectors should improve the allocation of capital by allowing entrepreneurs greater access to finance, which should particularly favor the poor. Others argue that improvements in the financial system primarily benefit the rich and politically connected. The literature has also been ambiguous about the channels through which finance may be associated with lower poverty (deposits versus credit). Looking at a sample of 37 countries in Sub-Saharan Africa from 1992 through 2006, the paper suggests that financial deepening is associated with lower poverty through different channels depending on the strength of property rights. In the absence of well-defined and enforced property rights, wider access to saving and risk-sharing instruments is accompanied by a reduction in poverty. Only once property rights grow stronger is credit associated with lower poverty.
- World Bank United States
TRADE LIBERALIZATION, BANK POLICY, FINANCIAL SECTOR DEVELOPMENT, INVESTMENT, BANKING SYSTEM, ECONOMIC GROWTH, EXTREME POVERTY, GROSS DOMESTIC PRODUCT, INCOME INEQUALITIES, DEPOSIT, INFLATION, FIXED EFFECT MODELS, CREDITOR, EXPROPRIATION, BROAD MONEY, LENDING, PRICE STABILITY, INVESTMENTS, INSTRUMENT, RIGHTS OF CREDITORS, RULE OF LAW, COMMERCIAL BANK ASSETS, INFLATION RATE, POVERTY, CONSUMER PRICE INDEX, INVESTORS, COLLATERAL, CREDIT GROWTH, TRANSACTIONS, BANK, LOANS, INFORMATION ON BORROWERS, PROBABILITY OF REPAYMENT, INTEREST RATES ON LOANS, MARKET CONSTRAINTS, LLC, RISK DIVERSIFICATION, FLOW OF CREDIT, EARNINGS, TRANSPARENCY, 330, FINANCIAL MARKETS, DEPOSIT MONEY BANKS, BORROWERS, DEPOSITS, MARKETS, CREDITORS, PROFIT, FINANCE, ECONOMIC OPPORTUNITIES, FIXED COST, PROPERTY RIGHTS, INTERNATIONAL FINANCIAL STATISTICS, LACK OF ACCESS, LIABILITIES, ACCESS TO SAVING, COMMON LAW, LEGAL RIGHTS, BALANCE SHEET, MORAL SUASION, DEFAULTS, INCOME INEQUALITY, LIQUIDITY, DUMMY VARIABLE, INSTRUMENTS, INTEREST RATES, MACROECONOMIC ENVIRONMENT, MARKET, DURABLE, CREDIT RATIONING, SAVING, DOMESTIC CREDIT, AMOUNT OF CREDIT, FINANCIAL SERVICES, PROPERTY, INEQUALITY, CONTRACT ENFORCEMENT, ECONOMIC DEVELOPMENT, DURABLE ASSETS, ACCESS TO FINANCE, RETURN, ENTREPRENEURS, MACROECONOMIC POLICIES, POOL OF BORROWERS, PRIVATE PROPERTY, CREDIT CONSTRAINTS, LEGAL PROTECTION, CAPITAL, POLITICAL ECONOMY, RISK SHARING, LENDERS, EXCHANGE, GREATER ACCESS, COMMERCIAL BANK, CHILD LABOR, REMITTANCES, INFORMATION ASYMMETRY, FINANCIAL SYSTEM, FINANCIAL INSTITUTIONS, HUMAN CAPITAL, GOOD, FINANCIAL STABILITY, HOUSEHOLDS, PRIVATE CREDIT, FINANCIAL INSTITUTION, BANK BRANCHES, DEFAULT, LOAN, CREDIT, BANK CREDIT, FINANCIAL DEVELOPMENT, DEVELOPING COUNTRIES, INTERNATIONAL BANK, COMMERCIAL BANKS, FUTURE, CONTRACT, LEGAL SYSTEMS, MONETARY FUND, MICRO DATA, CENTRAL BANKS, LABOR MARKETS, REPAYMENT, CONTRACTS, CREDITOR RIGHTS, INTEREST, ALLOCATION OF CAPITAL, CREDIT MARKETS, LEGAL ENVIRONMENT, LEGAL RIGHTS OF CREDITORS, BANK ASSETS, PROPERTY RIGHT, FINANCIAL STRUCTURE, DEBTORS, INCOME VARIABILITY, SHARE, INTEREST RATE, CREDIT MARKET
TRADE LIBERALIZATION, BANK POLICY, FINANCIAL SECTOR DEVELOPMENT, INVESTMENT, BANKING SYSTEM, ECONOMIC GROWTH, EXTREME POVERTY, GROSS DOMESTIC PRODUCT, INCOME INEQUALITIES, DEPOSIT, INFLATION, FIXED EFFECT MODELS, CREDITOR, EXPROPRIATION, BROAD MONEY, LENDING, PRICE STABILITY, INVESTMENTS, INSTRUMENT, RIGHTS OF CREDITORS, RULE OF LAW, COMMERCIAL BANK ASSETS, INFLATION RATE, POVERTY, CONSUMER PRICE INDEX, INVESTORS, COLLATERAL, CREDIT GROWTH, TRANSACTIONS, BANK, LOANS, INFORMATION ON BORROWERS, PROBABILITY OF REPAYMENT, INTEREST RATES ON LOANS, MARKET CONSTRAINTS, LLC, RISK DIVERSIFICATION, FLOW OF CREDIT, EARNINGS, TRANSPARENCY, 330, FINANCIAL MARKETS, DEPOSIT MONEY BANKS, BORROWERS, DEPOSITS, MARKETS, CREDITORS, PROFIT, FINANCE, ECONOMIC OPPORTUNITIES, FIXED COST, PROPERTY RIGHTS, INTERNATIONAL FINANCIAL STATISTICS, LACK OF ACCESS, LIABILITIES, ACCESS TO SAVING, COMMON LAW, LEGAL RIGHTS, BALANCE SHEET, MORAL SUASION, DEFAULTS, INCOME INEQUALITY, LIQUIDITY, DUMMY VARIABLE, INSTRUMENTS, INTEREST RATES, MACROECONOMIC ENVIRONMENT, MARKET, DURABLE, CREDIT RATIONING, SAVING, DOMESTIC CREDIT, AMOUNT OF CREDIT, FINANCIAL SERVICES, PROPERTY, INEQUALITY, CONTRACT ENFORCEMENT, ECONOMIC DEVELOPMENT, DURABLE ASSETS, ACCESS TO FINANCE, RETURN, ENTREPRENEURS, MACROECONOMIC POLICIES, POOL OF BORROWERS, PRIVATE PROPERTY, CREDIT CONSTRAINTS, LEGAL PROTECTION, CAPITAL, POLITICAL ECONOMY, RISK SHARING, LENDERS, EXCHANGE, GREATER ACCESS, COMMERCIAL BANK, CHILD LABOR, REMITTANCES, INFORMATION ASYMMETRY, FINANCIAL SYSTEM, FINANCIAL INSTITUTIONS, HUMAN CAPITAL, GOOD, FINANCIAL STABILITY, HOUSEHOLDS, PRIVATE CREDIT, FINANCIAL INSTITUTION, BANK BRANCHES, DEFAULT, LOAN, CREDIT, BANK CREDIT, FINANCIAL DEVELOPMENT, DEVELOPING COUNTRIES, INTERNATIONAL BANK, COMMERCIAL BANKS, FUTURE, CONTRACT, LEGAL SYSTEMS, MONETARY FUND, MICRO DATA, CENTRAL BANKS, LABOR MARKETS, REPAYMENT, CONTRACTS, CREDITOR RIGHTS, INTEREST, ALLOCATION OF CAPITAL, CREDIT MARKETS, LEGAL ENVIRONMENT, LEGAL RIGHTS OF CREDITORS, BANK ASSETS, PROPERTY RIGHT, FINANCIAL STRUCTURE, DEBTORS, INCOME VARIABILITY, SHARE, INTEREST RATE, CREDIT MARKET
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