We examine the impact of national governance quality on gender inequality in financial inclusion worldwide.
We devise an abnormal national governance index to measure national governance quality utilizing six dimensions of governance of the World Bank Worldwide Governance Indicators. Financial inclusion metrics include financial institution account ownership, debit or credit card ownership, saving, borrowing, and digital payment.
We find that improvement in national governance quality leads to decreased gender inequality in most financial inclusion measures. Also, national governance has differential impacts on gender inequality in financial inclusion depending on the nations’ income levels. In high-income economies, improved national governance leads to more equitable financial inclusion across genders for all financial inclusion measures. However, the effect of national governance quality is substantially reduced in less-developed economies.
This paper contributes to the extant literature by investigating how national governance quality affects gender inequality in financial inclusion utilizing a newly developed measure of national governance quality.
