Reducing income inequality and empowering women by financial inclusion in selected countries: The moderating role of financial innovation and trade openness

Abstract

This study examined the relationship between Financial inclusion, Income inequality and Women empowerment, towards the Sustainable Development Goals (SDGs) in 71 countries around the world, divided into 3 groups based on their income levels: high income, middle income and low income, from 2013 to 2022. This research contributed on the knowledge basis by adding Financial innovation and Trade openness as moderating roles. Facing the alarming layoff situation and unemployment after the Covid-19 pandemic, the author used “the percentage of female workers who are getting wages for their jobs” - Female Labour Force Participation rate as a measurement for Women empowerment. Adopted Two-step system (S-GMM) estimator showed that Financial inclusion has a negative effect on Income inequality but a positive effect on Women empowerment, which support the Public Good Theory. Moreover, these findings are expected to recommend policymakers some legal framework, programs and implications for different groups of countries in order to reduce Income Inequality and empower women, mainly focus on the importance of financial literacy and more effiencient financial system.