The impact of financial inclusion on economic growth and the moderating role of secondary education access: A Bayesian approach

Abstract

The article aims to analyze the impact of financial inclusion (FI) on economic growth (GDP) of countries around the world when assessing the moderating role of the level of access to secondary education (secondary school enrollment rate). The Bayesian method is used to process data from 35 countries in the period 2004- 2021, including 23 developing countries and 12 developed countries. Research results show that FI has a negative impact on countries' growth, especially the degree of this negative impact intensifies with increasing tertiary school enrollment rates. Besides, the human capital reserve, labor force, and inflation rate have an impact on increasing economic growth while the government expenditure hinder economic growth in countries. Based on the research results, the authors propose policy implications for countries: It is necessary to consider improving the comprehensiveness of finance, targeting necessary subjects and governments need to spend appropriately on basic educationto limit the negative impact of financial inclusion on countries' economic growth.