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Microfinance and gender inequality: cross-country evidence
Authors:Quanda Zhang  Alberto Posso
Institution:International Development and Trade Research Group, Royal Melbourne Institute of Technology, Melbourne, Australia
Abstract:Microfinance enables poor women to engage in income-generating activities, which helps them become financially independent, strengthening their decision-making power within the household and society. Consequently, microfinance has the potential to reduce gender inequality (GI). Case-study evidence from across the developing world both supports and contradicts this hypothesis. We therefore revisit this issue using macroeconomic cross-country panel data for 64 developing economies over the period 2003–2014. We find that women’s participation in microfinance is associated with a reduction in GI. However, regional interactions reveal that cultural factors are likely to influence the GI–microfinance nexus.
Keywords:Microfinance  financial inclusion  gender inequality  empowerment  panel data evidence
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