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Does financial literacy improve financial inclusion?: cross country evidence

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Authors and Corporations: Grohmann, Antonia (Author), Klühs, Theres (Author), Menkhoff, Lukas (Author)
Other Authors: Klühs, Theres [Author] • Menkhoff, Lukas 1958- [Author]
Type of Resource: E-Book
Language: English
published:
Berlin DIW Berlin, German Institute for Economic Research 2017
Series: Deutsches Institut für Wirtschaftsforschung: Discussion papers ; 1682
Subjects:
Source: Verbunddaten SWB
Lizenzfreie Online-Ressourcen
Description
Summary: While financial inclusion is typically addressed by improving the financial infrastructure we show that financial literacy, representing the demand-side of financial markets, also has a beneficial effect. We study this effect at the cross-country level, which allows to consider institutional variation. Regarding "access to finance", financial infrastructure and financial literacy are mainly substitutes. However, regarding the "use of financial services", the effect of higher financial literacy strengthens the effect of more financial depth. The causal interpretation of these results is supported by IV-regressions. Moreover, the positive impact of financial literacy holds across income levels and several subgroups within countries.
Physical Description: 1 Online-Ressource (circa 74 Seiten); Illustrationen