Levine, RossDemirgüç-Kunt, Asli2012-05-252012-05-252008-01https://hdl.handle.net/10986/6438An influential body of theoretical research and an emerging line of empirical work suggest that the operation of the formal financial system affects the degree to which economic opportunities are defined by talent and initiative rather than by parental wealth and social connections. This paper discusses the theory of how financial markets influence economic opportunity and reviews recent empirical work on the relation between formal financial systems and poverty, income inequality, and economic opportunity. The authors consider recent efforts to measure the ability of households and small enterprises to access financial services, the impact of this access, and the mechanisms through which finance affects poverty and inequality. The authors argue that considerably more research is needed to identify which formal financial sector policies enhance the operation of the financial system in ways that expand the economic horizons of the economically disenfranchised.CC BY 3.0 IGOACCESS BARRIERSACCESS TO CAPITALACCESS TO CREDITACCESS TO EXTERNAL FINANCEACCESS TO FINANCEACCESS TO FINANCIAL SERVICESACCURATE ESTIMATEAFFORDABILITYASSET RATIOATMSAUTOMATIC TELLERAVERAGE GROWTHBAD BANKSBANK ACCESSBANK ACCOUNTBANK ACCOUNTSBANK BRANCHBANK BRANCHESBANK COMPETITIONBANK REGULATIONBANK SERVICESBANKING SERVICESBANKSBARRIERBARRIER TO FINANCINGBEQUESTBEQUESTSBLACK WORKERBONDBONDSBROAD ACCESSBUSINESS CYCLEBUSINESS CYCLESCAPITAL ACCUMULATIONCAPITAL INVESTMENTCAPITAL MARKETCAPITAL MARKETSCHECKSCOLLATERALCOMMERCIAL BANKSCOMMUNICATIONS TECHNOLOGYCONSOLIDATIONCONTRIBUTIONCORPORATE GOVERNANCECORRUPTIONCREDIT ALLOCATIONCREDIT CONSTRAINTSCREDIT INFORMATIONCREDIT PROGRAMSCREDIT REGISTRIESCREDIT UNIONSCREDITORCREDITOR RIGHTSDEPOSITDEPOSIT ACCOUNTDEPOSIT ACCOUNTSDEPOSIT SERVICESDEREGULATIONDEVELOPING COUNTRIESDEVELOPING ECONOMIESDEVELOPMENT ASSISTANCEDEVELOPMENT BANKSDISCRIMINATIONDISTRIBUTION OF INCOMEDISTRIBUTION OF WEALTHDIVERSIFICATIONDOCUMENTATION REQUIREMENTSDOUBLE BOTTOM LINEDUMMY VARIABLEDUMMY VARIABLESEARNINGSECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC OPPORTUNITIESECONOMIC OPPORTUNITYECONOMIC PERFORMANCEECONOMIC POLICYEMPLOYERSEMPLOYMENTENTREPRENEURENTREPRENEURIAL ABILITYENTREPRENEURIAL ACTIVITYENTREPRENEURSENTREPRENEURSHIPEQUALITY OF OPPORTUNITYEXCLUSIONEXTERNAL FINANCEFAMILIESFINANCIAL ACCOUNTSFINANCIAL ARRANGEMENTSFINANCIAL ASSETSFINANCIAL DEPTHFINANCIAL DEVELOPMENTFINANCIAL DEVELOPMENTSFINANCIAL INSTITUTIONFINANCIAL INSTITUTIONSFINANCIAL INTERMEDIARIESFINANCIAL MARKETFINANCIAL MARKETSFINANCIAL PERFORMANCEFINANCIAL POLICYFINANCIAL SECTOR POLICIESFINANCIAL SECTOR POLICYFINANCIAL SECTOR REFORMSFINANCIAL SERVICESFINANCIAL SYSTEMFINANCIAL SYSTEMSFINANCING OBSTACLESFIRM GROWTHFIXED COSTFOREIGN BANKFOREIGN OWNERSHIPFOREIGN OWNERSHIP OF BANKSFORMAL FINANCIAL SECTORFORMAL FINANCIAL SERVICESGENERAL POPULATIONGOVERNMENT BANKGOVERNMENT OWNERSHIPGOVERNMENT OWNERSHIP OF BANKSGROSS DOMESTIC PRODUCTGROWTH OPPORTUNITIESGROWTH RATEGROWTH RATESHOLDINGHOUSEHOLDSHUMAN CAPITALINCOMEINCOME DISTRIBUTIONINCOME GROWTHINCOME INEQUALITYINCOME LEVELSINCOMESINDICATORS OF ACCESSINEQUALITYINFLATIONINFORMATION DISCLOSUREINFORMATION INFRASTRUCTURESINTEREST INCOMEINTEREST RATEINTERNATIONAL BANKINTERNATIONAL ECONOMICSINVESTINGINVESTMENT PROJECTSINVESTMENT RETURNSLABOR FORCELABOR FORCE PARTICIPATIONLARGE BANKSLAWSLEGAL CONSTRAINTSLEGAL ENFORCEMENTLENDERSLIQUIDITYLIQUIDITY RISKLOANLOAN AMOUNTLOAN APPLICATIONSLOAN BALANCESLOCAL BANKLOCAL BANKSLOW-INCOMEMACROECONOMICSMARGINAL COSTMARKET PARTICIPANTSMEDIUM ENTERPRISESMICRO DATAMICRO ENTERPRISESMICRO-CREDITMICROCREDITMICROENTERPRISESMICROFINANCEMICROFINANCE INSTITUTIONSMIDDLE EASTMONEY MARKETMONEY MARKET MUTUAL FUNDSMONOPOLIESMONOPOLYMUTUAL FUNDSNORTH AFRICAOUTREACHPHYSICAL ACCESSPOLITICAL ECONOMYPOSTAL SAVINGSPOVERTY ALLEVIATIONPRIVATE CREDITPROFIT MARGINSPROVISION OF CREDITPUBLIC POLICYRATE OF RETURNREGULATORSRENTSRETURN ON ASSETSRETURN ON SAVINGSRISK DIVERSIFICATIONRISK MANAGEMENTSAVINGSSAVINGS BANKSSAVINGS BEHAVIORSCHOOL FINANCESECURITIESSECURITIES MARKETSSELF-EXCLUSIONSENIORSMALL ENTERPRISESSMALLER ENTERPRISESSMALLER FIRMSSUB-SAHARAN AFRICASUPERVISORY POWERTRANSACTIONTRANSACTION COSTSTRANSACTIONS COSTSTRANSFER PAYMENTSWAGEWAGE RATESWORK FORCEWORTHWorld Bank10.1596/1813-9450-4468