[2021-01] Educational Inequality and Financial Inclusion: Effects of Compulsory Education and Sociodemographic Groups
[2021-01] Educational Inequality and Financial Inclusion: Effects of Compulsory Education and Sociodemographic Groups
Park, Eunjung
Moon Soul Graduate School of Future Strategy, KAIST
Yi, Sangyoon
Moon Soul Graduate School of Future Strategy, KAIST
Abstract
To enable financial inclusion, various policies are enforced internationally; however, there are diverse opinions on their effects. Previous research shows that education is necessary for individuals to understand financial products and services, and therefore financial initiatives including financial education are considered important. This study aimed to determine the effects of compulsory education on financial inclusion. To identify the sociodemographic groups for whom compulsory education is most likely to promote financial inclusion the most effectively, and the minimum compulsory education level needed for financial inclusion in each social group, we analyzed global data collected for each nation from the World Bank, the United Nations Development Programme, and the International Monetary Fund. We found that compulsory upper-secondary education had a considerable positive effect on financial inclusion in nearly all sociodemographic groups, including the middle-aged, women, high-income classes, and low-income classes, except for people aged 60 or older. Among these groups, compulsory upper-secondary education had the greatest effect on the financial inclusion in women. We also found that completion of only lower-secondary education promoted financial inclusion in the high-income class.
Keywords: financial inclusion, inequality, education, sociodemographic groups
AWARD