Abstract
This study re-examines the construct of financial inclusion, through a literature review and confirmatory factor analysis (CFA). First, we conduct a systematic review of definitions, measures, and data sources. Second, we apply CFA to test two prominent financial inclusion indices. The CFA analysis reveals a high correlation between the “access” and “use” dimensions; hence, indices fail to capture the multidimensionality of financial inclusion. Existing indices tend to be biased toward measuring the supply-side and quantitative aspects of financial inclusion. The extent to which lower-income individuals and smaller firms have been incorporated into the formal financial sector is not captured.
| Original language | English |
|---|---|
| Pages (from-to) | 316-341 |
| Number of pages | 26 |
| Journal | Journal of International Development |
| Volume | 33 |
| Issue number | 2 |
| Early online date | 18 Jan 2021 |
| DOIs | |
| Publication status | Published - Mar 2021 |
Keywords
- Financial inclusion
- access to finance
- systematic review
- measures
- confirmatory factor analysis
- financial inclusion
Access to Document
- Pesqué-Cela_et_al_IJD_DefiningAndMeasuring_AAM
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