Provincial Financial Inclusion in Turkey: Measurement and Its Spatial Determinants
This present study explores the drivers affecting the provincial financial inclusion levels by using data belonging to 81 Turkish provinces during 2011 – 2016. After computing the index of financial inclusion for each province, we used spatial regression methods which control for spatial dependences because Moran’s I statistic and Local Indicator of Spatial Association (LISA) analysis revealed that there are the spatial spillover and heterogeneity in provincial financial inclusion. To cope with the possible endogeneity problems, we estimated the spatial models via System GMM estimator. The findings show that “unemployment”, “urban”, “tourism”, “married”, “education”, “inflation” and “crime” variables are the determinants of provincial financial inclusion for Turkey. We also detect a convergence in financial inclusion levels of provinces.
___
- Al-Hussainy, E., Beck, T., Demirguc-Kunt, A., & Zia, B.
(2008). Household use of financial services. World
Bank Working Paper, 502-516.
- Andrianaivo, M., & Kpodar, K. (2011). ICT, financial
inclusion, and growth evidence from African countries. International Monetary Fund (No. 11-73).
- Anselin, L., Le Gallo, J., & Jayet, H. (2008). Spatial Panel
Econometrics. In L. Mátyás, & P. Sevestre (Eds.), The
econometrics of panel data (pp. 625–660). Berlin:
Springer-Verlag.
- Arcuri, G., Brunetto, M., & Levratto, N. (2019). Spatial
patterns and determinants of firm exit: an empirical analysis on France. The Annals of Regional
Science, 62(1), 99-118.
- Arellano, M., & Bover, O. (1995). Another look at the
instrumental variable estimation of error-components models. Journal of econometrics, 68(1), 29-51.
- Arora, R.U. (2014). Access to finance: an empirical
analysis. The European Journal of Development
Research, 26 (5), 798-814.
- Arun, T., & Kamath, R. (2015). Financial inclusion: Policies
and practices. IIMB Management Review, 27(4), 267-
287.
- Bai, C. E., Ma, H., & Pan, W. (2012). Spatial spillover and
regional economic growth in China. China Economic
Review, 23(4), 982-990. http://dx.doi.org/10.1016/j.
chieco.2012.04.016.
- Beck, T., Levine, R., & Levkov, A. (2007). Big bad banks?
The impact of US branch deregulation on income
distribution. The World Bank, NBER Working Paper
Series (13299).
- Belotti, F., Hughes, G., & Mortari, A. P. (2016). Spatial
panel data models using Stata. CEIS Research Papers
No.373, 14(5), 1-40.
- Blundell, R., & Bond, S. (1998). Initial conditions and
moment restrictions in dynamic panel data models. Journal of econometrics, 87(1), 115-143.
- Bouayad-Agha, S., & Vedrine, L. (2010). Estimation strategies for a spatial dynamic panel using GMM. A new
approach to the convergence issue of European
regions. Spatial Economic Analysis, 5(2), 205-227.
- Bozkurt, I., Karakuş, R., & Yildiz, M. (2018). Spatial Determinants of Financial Inclusion over Time. Journal of
International Development, 30(8), 1474-1504.
- Bruhn, M., & Love, I. (2014). The real impact of improved
access to finance: Evidence from Mexico. The Journal
of Finance, 69(3), 1347-1376.
- Carrillo-Hidalgo, I., & Pulido-Fernández, J. I. (2019). Is
the financing of tourism by international financial
institutions inclusive? A proposal for measurement. Current Issues in Tourism, 22(3), 330-356.
- Caselli, F., Esquivel, G., & Lefort, F. (1996). Reopening the
Convergence Debate: A New Look at Cross-Country
Growth Empirics. Journal of Economic Growth, 1,
363-389.
- Chattopadhyay, S.K. (2011). Financial Inclusion in India:
A case study of West Bengal. RBI Working Paper Series
(DEPR), 8/2011.
- Chithra, N., & Selvam, M. (2013). Determinants of financial inclusion: An empirical study on the inter-state
variations in India. Retrieved from, SSRN: http://
dx.doi.org/10.2139/ssrn.2296096
- Dabla-Norris, M. E., Ji, Y., Townsend, R., & Unsal, D. F.
(2015). Identifying constraints to financial inclusion
and their impact on GDP and inequality: A structural
framework for policy . IMF Working Paper (No. 15-22).
International Monetary Fund, Washington.
- Debarsy, N., Ertur, C., & LeSage, J. P. (2012). Interpreting
dynamic space–time panel data models. Statistical
Methodology, 9(1-2), 158-171.
- Demirguc-Kunt, A., Klapper, L., & Randall, D. (2013). Islamic finance and financial inclusion: measuring use
of and demand for formal financial services among
Muslim adults. (Policy Research Working Paper No.
6642). TheWorld Bank, Washington, DC.
- Demirgüç-Kunt, A., Klapper, L., Singer, D., & Van Oudheusden, P. (2015). The Global Findex Database 2014.
Measuring Financial Inclusion Around the world (Policy Research Working Paper No. 7255). The World
Bank, Washington, DC.
- Elhorst, J.P. (2010). Spatial panel data models. In Handbook of Applied Spatial Analysis. Edited by Fischer
Manfred, and Getis Arthur. New York: Springer.
- Evans, O., & Adeoye, B. (2016). Determinants of Financial
Inclusion in Africa: A Dynamic Panel Data Approach.
University of Mauritius Research Journal, 22, 310-336.
- Fawole, O. I. (2008). Economic violence to women and
girls: is it receiving the necessary attention?. Trauma,
Violence, & Abuse, 9(3), 167-177.
- Fingleton, B., & Le Gallo, J. (2008). Estimating spatial
models with endogenous variables, a spatial lag and
spatially dependent disturbances: Finite sample
properties. Papers in Regional Science, 87(3), 319-
339.
Fungáčová, Z., & Weill, L. (2015). Understanding financial inclusion in China. China Economic Review, 34,
196-206.
- Gupte, R., Venkataramani, B., & Gupta, D. (2012). Computation of financial inclusion index for India. Procedia-Social and Behavioral Sciences, 37, 133-149.
Guillain, R., Le Gallo, J., & Boiteux-Orain, C. (2006).
- Changes in spatial and sectoral patterns of
employment in Ile-de-France, 1978-97. Urban studies, 43(11), 2075-2098.http://dx.doi.
org/10.1080/00420980600945203.
- Güngen, A. R. (2018). Financial inclusion and policy-making: Strategy, campaigns and microcredit a
la Turca. New Political Economy, 23(3), 331-347.
Gürkan, Ö. C., & Coşar, F. (2009). Ekonomik şiddetin
kadın yaşamındaki etkileri. Maltepe Üniversitesi
Hemşirelik Bilim ve Sanatı Dergisi, 2(3), 124-129.
- Honohan, P. (2008). Cross-country variation in household access to financial services. Journal of Banking
& Finance, 32(11), 2493-2500.
- Kairiza, T., Kiprono, P., & Magadzire, V. (2017). Gender
differences in financial inclusion amongst entrepreneurs in Zimbabwe. Small Business Economics, 48(1),
259-272.
- Kendall, J., Mylenko, N., & Ponce, A. (2010). Measuring
Financial Access around the World. Policy Research
Working Paper, No 5253 (Washington: World Bank).
- Kocacik, F., & Dogan, O. (2006). Domestic violence
against women in Sivas, Turkey: survey study. Croatian medical journal, 47(5), 742-749.
- Kumar, N. (2013). Financial inclusion and its determinants: evidence from state level empirical analysis in
India. Journal of Financial Economic Policy, 5 (1), 4-19.
- Lee, L. F., & Yu, J. (2010). Some recent developments
in spatial panel data models. Regional Science and
Urban Economics, 40(5), 255-271.
- LeSage, J.P. (1999). Spatial Econometrics: Regional Research Institute. West Virginia University.
- LeSage, J.P., & Pace, R.K. (2009). Introduction to Spatial
Econometrics. Taylor & Francis.
- Lottmann, F. (2012). Spatial dependencies in German
matching functions. Regional Science and Urban Economics, 42 (1–2), 27–41. http://dx.doi.org/10.1016/j.
regsciurbeco.2011.04.007.
- Marr, A., & Schmied, J. (2013) Financial inclusion and
poverty: The case of Peru. In: 3rd European Research
Conference on Microfinance, 10-12 Jun 2013,
University of Agder, Kristiansand, Norway.
- Mohieldin, M., Iqbal, Z., Rostom, A., & Fu, X. (2011). The
role of Islamic finance in enhancing financial inclusion in Organization of Islamic Cooperation (OIC)
countries. The World Bank, Islamic Economics and
Finance Working Group (WPS5920).
- Moran, P. A. (1950). Notes on continuous stochastic
phenomena. Biometrika, 37(1/2), 17-23. http://
dx.doi.org/10.2307/2332142.
- Nwafor, M. C., & Yomi, A.I. (2018). The Nexus between
Financial Inclusion and Economic Growth: Evidence
from Nigeria. International Journal of Science and
Innovation in Social Science, 2(4), 143-149.
- Sahay, R., Cihak, M., N’Diaye, P., Barajas, A., Mitra, S.,
Kyobe, A., Nian Mooi, Y., & Reza Yousefi, S. (2015). Financial inclusion: can it meet multiple macroeconomic
goals?. IMF staff discussion note 15/17. International
Monetary Fund, Washington.
- Sahoo, A. K., Pradhan, B. B., & Sahu, N. C. (2017). Determinants of Financial Inclusion in Tribal Districts
of Odisha: An Empirical Investigation. Social
Change, 47(1), 45-64.
- Sarma, M. (2008). Index of financial inclusion. Working
Paper No.215, Indian Council for Research on International Economic Relations.
Setiawan, C., Wati, K., & Putu, N. (2019). Factors Affecting
the Performance of Sharia Equity Funds in Indonesia. Iranian Journal of Management Studies, 12(4),
481-508.
- Schmied, J., & Marr, A. (2017). Financial inclusion and
poverty: The case of Peru. Regional and Sectoral
Economic Studies, 16(2), 1-26.
- Siddik, M. N. A., Sun, G., & Kabiraj, S. (2015). Financial
inclusion and its determinants: A study of Bangladesh. Indian Journal of Finance, 9(6), 7-29.
Swamy, V. (2014). Financial inclusion, gender dimension,
and economic impact on poor households. World
Development, 56, 1-15.
- Qiang X, Kan Tao. (2017). The Measurement of China’s
Index of Financial Inclusion and Its Relationship
with Poverty Aueviation: Analysis Based on Provincial Data. Journal of Central China Normal University
56 (6): 40-51.
- Uddin, A., Chowdhury, M. A. F., & Islam, M. N. (2017).
Determinants Of Financial Inclusion In Bangladesh:
Dynamic Gmm & Quantile Regression Approach. The Journal of Developing Areas, 51(2), 221-237.
Wang, X., & Guan, J. (2017). Financial inclusion: measurement, spatial effects and influencing factors. Applied
Economics, 49(18), 1751-1762.
- Yadav, P., & Sharma, A. K. (2016). Financial inclusion in
India: an application of TOPSIS. Humanomics, 32(3),
328-351.
- Yorulmaz, R. (2013). Construction of a regional financial
inclusion index in Turkey. Journal of BRSA Banking
and Financial Markets, 7(1), 79-101.
- Zins, A., & Weill, L. (2016). The determinants of financial
inclusion in Africa. Review of Development Finance, 6(1), 46-57.