FINANCIAL DEVELOPMENT AND THE ATTAINMENT OF INCLUSIVE GROWTH IN AFRICA

Abstract

This study investigated the nexus between Financial Development (FD) and Inclusive Growth (IG) in Africa. Unlike the extant literature whose concentration has been on using gross domestic product per capita as an indicator for inclusive growth, this study used the inclusive growth index. The study employed 18-year panel data collected from across 27 African countries in the dynamic estimations of the FD-IG nexus using the mean group (MG) estimator. The results showed that all financial development indicators exhibited only a significant impact on the inclusive growth index in the long run with mixed nexus except atm. It was established that financial development. The findings underscored the need for policymakers to develop innovative, sustainable, and inclusive financial systems capable of distributing growth benefits equitably.