Research On The Relationship Between Financial Inclusion And Economic Growth

In recent decades,the topic of financial inclusion has received widespread attention from scholars,policy makers and other stakeholders.This is because the financial inclusion as the concrete manifestations of inclusive financial system development,help to improve all the participants in an economy on formal financial services(for example,bank deposits,loans,insurance,etc.)availability,usage and service quality,etc.,so as to further reduce the inequality,optimize the allocation of resources,improve the level of income,and promote economic growth.The increase in the scope,object and content of financial services and the lowering of the threshold mean that all social strata can obtain appropriate financial services to solve certain economic problems,thus encouraging residents to consume and invest,and encouraging small and medium-sized enterprises to expand production through financing,thus promoting economic growth.At the same time,with the continuous development of economy,the construction of financial infrastructure,financial system and other financial systems continues to improve,and relevant financial knowledge is widely known,which will further promote the development of financial inclusion.Therefore,discussing the relationship between financial inclusion and economic growth is conducive to formulating financial inclusion policies suitable for the development of different economies,so as to achieve high-quality economic and financial development.Through reviewing relevant literature,it is found that the current research on the relationship between financial inclusion and economic growth is usually one-way,and the measurement of the development level of financial inclusion rarely covers multi-dimensional comprehensive indicators.Therefore,this paper through theoretical and empirical analysis of a combination of research relationship between financial inclusion and economic growth,given the different economy level of economic development,this article selects a sample of the G20 countries,it is divided into developed countries and developing countries respectively,aiming at different economies provide appropriate evidence of financial inclusion development.In terms of theoretical research,the theoretical basis of economic growth and the development of financial inclusion is sorted out based on the research theme.Based on this,the interaction mechanism between financial inclusion and economic growth is further analyzed theoretically.In the aspect of empirical analysis,this paper preliminarily studies the dynamic development of financial inclusion by constructing comprehensive indicators and kernel density estimation.The panel vector autoregression(PVAR)model was further used for empirical test,and the theoretical analysis results were verified by granger causality test,GMM estimation of PVAR,impulse response analysis and variance decomposition results.Through theoretical analysis and empirical test,the development level of financial inclusion in G20 countries is gradually improving.The development level of financial inclusion in developed countries is higher than that in developing countries,but the growth trend is slower.In terms of the relationship between financial inclusion and economic growth,there is a mutually promoting relationship between the two,which has a certain lag,and the former has a greater impact on the latter.Compared with developed countries,the mutual promotion effect of financial inclusion and economic growth in developing countries is more significant in the long run.In view of this,this paper suggests that the development system of financial inclusion should be further improved.For developed countries,the depth and breadth of financial inclusion can be further enhanced by means of information technology at low cost.For developing countries,on the premise of vigorously developing economy,they should formulate inclusive finance development policies suitable for their own national development level.