Access to Finance and Its Association with Development in Rural India
AbstractFinancial development has been correlated with better development outcomes. Even so, the access dimension of financial development has often been overlooked. In this context, the paper throws initial light on the nuances of horizontal inequality in the access to finance from institutional sources and development outcomes such as poverty, educational attainment and standard of living in rural area for Indian states. It is seen that the percentage of rural households getting access to finance from institutional agencies has remained considerably low and there is significant variation across states. More importantly, there is significant amount of horizontal inequality in the access to finance from institutional sources. Interestingly, better access to finance is found to be associated with better development outcomes. The most important finding of the paper is that lower (higher) inequality in the access to finance from institutional sources is associated with better (worse) development outcomes.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 20033.
Date of creation: 17 Aug 2009
Date of revision:
access to finance; development; horizontal inequality; rural household;
Find related papers by JEL classification:
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
- R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-01-23 (All new papers)
- NEP-CWA-2010-01-23 (Central & Western Asia)
- NEP-MFD-2010-01-23 (Microfinance)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Claessens, Stijn & Perotti, Enrico, 2007. "Finance and inequality: Channels and evidence," Journal of Comparative Economics, Elsevier, vol. 35(4), pages 748-773, December.
- Cecilia Garcia-Penalosa & Eve Caroli & Philippe Aghion, 1999.
"Inequality and Economic Growth: The Perspective of the New Growth Theories,"
Journal of Economic Literature,
American Economic Association, vol. 37(4), pages 1615-1660, December.
- Aghion, Philippe & Caroli, Eve & Garcia-Penalosa, Cecilia, 1999. "Inequality and economic growth: the perspective of the new growth theories," CEPREMAP Working Papers (Couverture Orange) 9908, CEPREMAP.
- Beck, T.H.L. & Torre, A. de la, 2007.
"The basic analytics of access to financial services,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-3125424, Tilburg University.
- Beck, Thorsten & de la Torre, Augusto, 2006. "The basic analytics of access to financial services," Policy Research Working Paper Series 4026, The World Bank.
- Garcia-Penalosa, Cecilia & Aghion, Philippe & Caroli, Eve, 1999. "Inequality and Economic Growth: The Perspective of the New Growth Theories," Economics Papers from University Paris Dauphine 123456789/10091, Paris Dauphine University.
- Jacoby, Hanan G & Skoufias, Emmanuel, 1997. "Risk, Financial Markets, and Human Capital in a Developing Country," Review of Economic Studies, Wiley Blackwell, vol. 64(3), pages 311-35, July.
- Bhandari, Amit Kumar, 2009.
"Access to Banking Services and Poverty Reduction: A State-wise Assessment in India,"
IZA Discussion Papers
4132, Institute for the Study of Labor (IZA).
- Amit. K. Bhandari, 2009. "Access to Banking Services and Poverty Reduction: A State-wise Assessment in India," Working Papers id:2070, eSocialSciences.
- Shahidur R. Khandker, 2005.
"Microfinance and Poverty: Evidence Using Panel Data from Bangladesh,"
World Bank Economic Review,
World Bank Group, vol. 19(2), pages 263-286.
- Khandker, Shahidur R., 2003. "Microfinance and poverty - evidence using panel data from Bangladesh," Policy Research Working Paper Series 2945, The World Bank.
- Beck, T.H.L. & Demirgüç-Kunt, A. & Levine, R., 2007.
"Finance, inequality and the poor,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-3125426, Tilburg University.
- Gérard Roland, 2004.
"Transition and Economics: Politics, Markets, and Firms,"
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 026268148x, January.
- Gérard Roland, 2000. "Transition and Economics: Politics, Markets, and Firms," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262182033, January.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If references are entirely missing, you can add them using this form.