Financial Inclusion Institutional Quality and Economic Growth in Asia

Abstract

This study intends to investigate the impact of Financial Inclusion, Institutional Quality on economic growth, using a sample of 23 countries from 2006-2017. The role of financial inclusion and institutional quality is subsequently estimated through static and dynamic panel models. A composite indicator of financial inclusion is constructed via principal component analysis (PCA). We document that financial inclusion and institutional quality are positively associated with economic growth. This piece of work provides a base for policy formulators to streamline their efforts towards reformative processes in financial sectors for promoting financial inclusiveness and taking necessary steps to regulate and strengthen the institutional quality in ensuring sustainable economic growth.