This study investigates the impact of financial inclusion and corruption control on inclusive growth in Sub-Saharan Africa (SSA). Employing the generalized method of moments (GMM) and fixed-effect techniques, the research finds that financial inclusion and corruption control significantly contribute to inclusive growth in the region. The results also reveal that trade openness is positively associated with inclusivity, while the impact of remittances is negative. The study recommends prioritizing initiatives aimed at enhancing access to formal financial services across diverse segments of the population. Likewise, it underscores the critical importance of implementing robust anti-corruption measures to create an environment that fosters inclusive economic development.
TopIntroduction
The dynamics of global economic development have undergone a profound and transformative shift in recent years, propelled by a confluence of technological advancements, geopolitical shifts, and changing societal expectations (Audi & Ali, 2019; Bai, 2023). This transformation has ushered in an era where the traditional paradigms of economic progress are being re-evaluated and redefined. As nations navigate this rapidly evolving economic landscape, the imperative to foster development has taken on a multi-dimensional character, extending beyond the mere pursuit of economic prosperity to encompass a more holistic and inclusive vision (Lee & Liao, 2022).
In the face of these transformative forces, nations find themselves at a critical juncture, compelled to confront the challenges inherent in achieving development that not only stimulates economic growth but also addresses the pervasive social disparities that persist in many corners of the world. The traditional metrics of economic success, often centered around Gross Domestic Product (GDP) growth, are increasingly viewed through a more nuanced lens that considers the broader impact on society (Qureshi, 2020). This shift in perspective acknowledges that sustainable development must go beyond raw economic output to encompass the well-being of diverse populations, ensuring that the fruits of progress are equitably distributed (Adrian, 2022).
Financial inclusion, a key pillar of contemporary development discourse, encapsulates the accessibility and usage of financial services by diverse segments of the population (Ozili, 2022). Recognizing that access to financial resources is instrumental in poverty alleviation and economic empowerment, governments, international organizations, and financial institutions have embarked on initiatives to extend financial services to the unbanked and underprivileged (Demirgüç-Kunt & Singer, 2017; Azimi, 2022). The transformative potential of financial inclusion in unlocking economic opportunities and reducing inequalities has become increasingly evident (Park & Mercado Jr, 2018; Omar & Inaba, 2020; Cicchiello et al., 2021; Kazemikhasragh & Buoni Pineda, 2022; Demir et al., 2022).
Simultaneously, corruption continues to be a formidable barrier to sustainable development (Troisi et al., 2023). Rampant corruption erodes public trust, diverts public resources, and undermines the effectiveness of policy interventions (Yakubu et al., 2023). The detrimental impact of corruption on economic growth and social welfare has spurred global efforts to enhance transparency, strengthen institutions, and implement anti-corruption measures.
In the pursuit of holistic development, the concept of inclusive growth has gained prominence. Inclusive growth goes beyond the conventional focus on GDP expansion and emphasizes the need for economic growth to be broad-based, benefiting all segments of society (Breau et al., 2023). It advocates for the equitable distribution of opportunities and resources, ensuring that the benefits of economic progress reach marginalized and vulnerable populations.