The Mutual Relationship between Financial Inclusion and Effectiveness of Monetary Policy: Evidence from Upper-Middle-Income Countries

Abstract

Enhancing financial inclusion is crucial for achieving global objectives such as sustainable growth, improved societal welfare, and poverty reduction. Due to its importance, financial inclusion has recently become a key policy issue and a widely studied topic. This study investigates the relationship between financial inclusion and monetary policy in upper-middle-income countries using the Two-Step System GMM and Panel Granger Causality methods. The findings reveal a bidirectional negative relationship between inflation and financial inclusion. Inflation negatively affects financial inclusion, while an increase in financial inclusion has a reducing effect on inflation. Additionally, digitalization, regulatory quality, and money supply positively affect financial inclusion, while the growth of money supply and deposit interest rates increase inflation. According to Granger causality analysis, there is a causality running from financial inclusion to the inflation rate. Accordingly, policymakers in upper-middle-income countries are advised to adopt balanced monetary policies and consider that increasing financial inclusion can help mitigate the adverse effects of inflation.

Keywords

• Financial Inclusion
• Monetary Policy
• Dynamic Panel Data Analysis

Finansal Kapsayıcılık ile Para Politikası Etkinliği Arasındaki Karşılıklı İlişki: Üst-Orta Gelirli Ülkelerden Kanıtlar

Abstract

Finansal kapsayıcılığın artırılması; sürdürülebilir büyüme, toplumsal refahın yükseltilmesi ve yoksulluğun azaltılması gibi küresel hedeflere ulaşmada kritik bir unsurdur. Bu önem doğrultusunda, finansal kapsayıcılık son yıllarda küresel bir politika önceliği ve literatürde sıkça incelenen bir konu haline gelmiştir. Bu çalışma, üst-orta gelirli ülkelerde finansal kapsayıcılık ve para politikası arasındaki ilişkiyi İki Aşamalı Sistem GMM ve Panel Granger Nedensellik yöntemleriyle incelemektedir. Bulgular, enflasyon ile finansal kapsayıcılık arasında çift yönlü negatif bir ilişki olduğunu göstermektedir. Enflasyon finansal kapsayıcılığı negatif yönde etkilerken, finansal kapsayıcılıktaki artışta enflasyonu düşürücü etki yapmaktadır. Ayrıca dijitalleşme, düzenleyici kalite ve para arzı finansal kapsayıcılığı pozitif yönde etkilerken, para arzındaki büyüme ve mevduat faizleri enflasyonu artırmaktadır. Granger nedensellik sonuçları, finansal kapsayıcılıktan enflasyona doğru bir nedensellik olduğunu göstermektedir. Bu doğrultuda, üst-orta gelirli ülkelerdeki politika yapıcılara dengeli para politikaları benimsemeleri ve finansal kapsayıcılığın enflasyon üzerindeki olumsuz etkileri hafifletebileceğini dikkate almaları önerilmektedir.

Keywords

• Finansal Kapsayıcılık
• Para Politikası
• Dinamik Panel Veri Analizi

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