Impact of financial development on Income inequality in Vietnam

Abstract

Utilizing the approach of constructing indicators treated as representatives for degree of financial development at provincial level of Vietnam over the 2002–2012 period along with Generalized Method of Moments (GMM), this study inspects the nexus between financial development and income inequality. To a certain extent the empirical findings present evidence to show that financial market expansion in Vietnam widens income inequality, through which some policy recommendations are provided with regard to reducing the inequality of income distribution across the society.