Remittances, Financial Inclusion and Poverty Linkages : An Empirical Study from Pakistan
Author: Muhammad Salman

Financial inclusion is considered as wide-ranging delivery of financial/banking services at very affordable rate to the every section of population including poor and small enterprises. Lack of the availability and use of financial services are seemed as key reasons of poverty. This study analyses both long run and short run association between the financial inclusion and poverty & remittance and financial inclusion by using the annual time series data of Pakistan‘s economy by applying ARDL (Auto Regressive Distributive Lag) technique. Most striking result revealed by this study is that financial inclusion does not have statistically significant impact on poverty. The reason might be due to lack of availability of credit facilities in poor areas, lack of culture of entrepreneurship, religious factor and profit oriented banking sector in Pakistan. Inflation and income inequality hurt the poverty in long run which implies that higher price level and low equal distribution of income increase the poverty head count, where increase in average income of whole population leads to reduce poverty head count in Pakistan. Furthermore, results of this study reveal that remittances have positive significant impact on financial inclusion in long run but not in short run might be due to higher cost of transaction. Higher literacy rate and population density raise the financial inclusion by demanding more financial services. Supervisor:- Dr. Attiya Yasmin Javid

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Keywords : ARDL, Financial Inclusion, GDP, Poverty, REMITTANCES
Supervisor: Attiya Yasmin Javid

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