THE NEXUS AMONG FINANCIAL DEVELOPMENT AND POVERTY REDUCTION: AN APPLICATION OF ARDL APPROACH FROM THE MENA REGION

Authors : Leila Chemli

Pages : 133-148

Doi:10.15637/jlecon.46

View : 16 | Download : 11

Publication Date : 2014-10-30

Article Type : Other

Abstract :The objective of this paper is to examine the relationship between financial development and poverty reduction in 8 MENA countries (Algeria, Egypt, Iran, Jordan, Mauritania, Morocco, Tunisia and Yemen) over the period of 1990-2012 by using an "ARDL approach”. Our empirical results show that the financial development favors the poor. The ratio to domestic credit to the private sector as % of GDP is significant and positive for Algeria, Iran, Jordan, and Tunisia. This country represents a sample of the upper-middle-income economies. While the ratio to liquid liabilities (M3) as % of GDP is significant and positive for our entire sample. This result suggests that access to credit for the poor remains a challenge.
Keywords : financial development, poverty reduction, ARDL approach.