Financial Inclusions, Financial Stability, and Income Inequality in Oic Countries: A GMM and Quantile Regression Application

Abdulkarim, Fatima Muhammad; Ali, Hamisu Sadi

doi:10.21098/jimf.v5i2.1069

Cited by 4 publications

(3 citation statements)

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“…Other studies that focus on examining income inequality in OIC member countries find that the financial sector is a determining factor in reducing income inequality. Increasing access to finance for the community has an impact on more equitable income (Abdulkarim & Ali, 2019;Linawati et al, Based on the background and previous research on income inequality, a lot has indeed been done before. Including the Organization of Islamic Cooperation (OIC) countries, but previous research only focused on economic factors or human capital factors and fiscal policy.…”

Section: Abstrakmentioning

confidence: 99%

“…The method used in this research was panel data regression with the system-generalized method of moment (GMM) approach developed by Arellano & Bond (1991, 1998 and Blundell & Bond (1998) and follows the steps described by Roodman (2009) and Mileva (2007). Empirical research also uses many similar methods such as Abdulkarim & Ali (2019); Dendo et al, (2021;Dilmaghani & Tehranchian (2015). This method is used to produce unbiased, consistent, and efficient models (Saputri & Wibowo, 2018).…”

Section: World Bankmentioning

confidence: 99%

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Macroeconomics, sharia, and economic inequality in The Organization of Islamic Cooperation (OIC): An empirical study

Zakwan Asrari,

Wau

2023

JESTT

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This study aimed to determine the factors that influence the level of income inequality in member countries of the Organization of Islamic Cooperation (OC). The research period used was from 2012 to 2021, using the System Generalized Method of Moment (GMM) analysis tool. The variables used consist of the Gini ratio (proxy of income inequality), economic growth, Foreign Direct Investment (FDI), inflation, the average length of schooling (human capital proxy), and corruption perception index (sharia proxy). The results showed that sharia, human, and inflation variables had a negative effect, while economic growth and FDI had a positive and significant effect on income inequality in OIC countries. These results show that in addition to economic factors and human capital, sharia elements cannot be released in overcoming income inequality in OIC countries. Sharia is a driving factor in a more even distribution of income. Keywords: Income Inequality, Organization of Islamic Cooperation (OIC), System Generalized Method of Moment (GMM), Sharia ABSTRAK Penelitian ini bertujuan untuk mengetahui faktor-faktor yang mempengaruhi tingkat ketimpangan pendapatan di negara anggota Organization of Islamic Cooperation (OIC). Periode penelitian yang digunakan adalah dari tahun 2012 sampai dengan tahun 2021, dengan menggunakan alat analisis System Generalized Method of Moment (GMM). Variabel yang digunakan terdiri dari rasio gini (proksi ketimpangan pendapatan), pertumbuhan ekonomi, Foreign Direct Investment (FDI), inflasi, rata-rata lama sekolah (proksi human capital), dan indeks persepsi korupsi (proksi syariah). Hasil penelitian menunjukkan bahwa variabel syariah, human, dan inflasi berpengaruh negatif, sedangkan pertumbuhan ekonomi dan FDI berpengaruh positif dan signifikan terhadap ketimpangan pendapatan di negara-negara OIC. Hasil ini menunjukkan bahwa selain faktor ekonomi dan human capital unsur syariah tidak bisa dilepaskan dalam mengatasi ketimpangan pendapatan di negara OIC. Syariah menjadi faktor pendorong dalam distribusi pendapatan yang lebih merata. Kata kunci: Ketimpangan Pendapatan, Organization of Islamic Cooperation (OIC), System Generalized Method of Moment (GMM), Syariah REFERENCES Abdulkarim, F. M., & Ali, H. S. (2019). Financial inclusions, financial stability, and income inequality in oic countries: A GMM and quantile regression application. Journal of Islamic Monetary Economics and Finance, 5(2), 419–438. doi:10.21098/jimf.v5i2.1069 Alamanda, A. (2021). The effect of economic growth on income inequality: Panel data analysis from fifty countries. Info Artha, 5(1), 1–10. doi:10.31092/jia.v5i1.1176 Anto, M., H. (2011). Introducing an Islamic Human Development Index (I-HDI) to measure development in OIC countries. Islamic Economic Studies, 19(2), 69–95. Arellano, M., & Bond, S. (1991). 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Section: Abstrakmentioning

confidence: 99%

Section: World Bankmentioning

confidence: 99%

Macroeconomics, sharia, and economic inequality in The Organization of Islamic Cooperation (OIC): An empirical study

Zakwan Asrari,

Wau

2023

JESTT

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“…So far, studies of financial inclusion in OIC countries discuss its role in economic growth and stability and in the eradication of social inequality (Abdulkarim & Ali, 2019;Kim et al, 2018). To the best of our knowledge, ours is the first empirical study to investigate the determinants of mobile money usage in OIC countries at an individual level.…”

Section: Introduction 11 Backgroundmentioning

confidence: 96%

Online Payment, Individual Characteristics, and Digital Financial Inclusion in Oic Countries

Hashfi

Zusryn

Khoirunnisa

et al. 2020

JIMF

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Digital financial inclusion (DFI) is a prominent issue in the digital era, since it focuseson the use of technology to serve unbanked people at low cost. The adoption ofmobile money platforms that allow users to make efficient peer-to-peer and real-timetransactions is one aspect of the DFI agenda. This study aims to investigate thedeterminants of mobile money usage using data derived from the 2017 GlobalFinancial Inclusion survey conducted by the World Bank and Gallup and applyingprobit regression and the Heckman selection model to check robustness. Eventhough access to a financial institution is relatively low, the percentage of mobilemoney usage in Organisation of Islamic Cooperation (OIC) countries is slightly higherthan in non-OIC countries and worldwide. The rate of adoption of mobile money ishigher for individuals making online transactions, with more educated and moreprosperous males tending to be more included in the use of digital financial services.The U-shape hypothesis for the relationship between age and the use of mobilemoney is not supported. Our research contributes to the theoretical development ofthe Unified Theory of Acceptance and Use of Technology 2 in illustrating the use ofmobile technology. The empirical results are recommended for use by practitioners,regulators and policymakers in creating and fostering a sound ecosystem for digitalfinance development.

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Financial development and income inequality in Africa

Okafor

Olurinola

Bowale

et al. 2023

Humanit Soc Sci Commun

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Across the globe, a rise in income inequality has been experienced for the last two decades, particularly in developing countries. This problem of income inequality poses a challenge to Africa’s ability to attain the United Nations (UN) Sustainment Development Goals (SDGs) of reduced inequalities (SDG-10). Against this backdrop, there is a need to harness the potential of financial development to reduce income inequality in Africa. Therefore, this study empirically examines how financial development affects income inequality in Africa. Financial development dimensions, access, depth, efficiency, and stability were considered to achieve the study’s objective. The study applied the system generalized method of moments (SGMM) to analyse data and the findings showed that each dimension of financial development had a varying impact on income inequality. Access, stability and efficiency components of financial development reduce income inequality, while the depth dimension of financial development exacerbates income inequality in Africa. Therefore, the study recommends that policymakers should not neglect other dimensions of finance in facilitating economic development.

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Financial Inclusions, Financial Stability, and Income Inequality in Oic Countries: A GMM and Quantile Regression Application

Cited by 4 publications

References 17 publications

Macroeconomics, sharia, and economic inequality in The Organization of Islamic Cooperation (OIC): An empirical study

Macroeconomics, sharia, and economic inequality in The Organization of Islamic Cooperation (OIC): An empirical study

Online Payment, Individual Characteristics, and Digital Financial Inclusion in Oic Countries

Financial development and income inequality in Africa

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