Finance and Inequality
- ISBN-10
- 1513526545
- ISBN-13
- 9781513526546
- Category
- Business & Economics
- Pages
- 50
- Language
- English
- Published
- 2020-01-17
- Publisher
- International Monetary Fund
- Authors
- Mr.Martin Cihak, Ms.Ratna Sahay
Description
The study examines empirical relationships between income inequality and three features of finance: depth (financial sector size relative to the economy), inclusion (access to and use of financial services by individuals and firms), and stability (absence of financial distress). Using new data covering a wide range of countries, the analysis finds that the financial sector can play a role in reducing inequality, complementing redistributive fiscal policy. By expanding the provision of financial services to low-income households and small businesses, it can serve as a powerful lever in helping create a more inclusive society but—if not well managed—it can amplify inequalities.
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