This study investigates the relationship between financial inclusion (FI) and human development (HD) in low-, lower-middle-, and upper-middle-income countries (LICs, LMICS, and UMICS) using data from 79 countries between 2000 and 2017. Employing the System Generalized Method of Moments (SGMM) and dynamic threshold panel (DTP) methods, the study finds that FI generally positively impacts HD in LMICS and UMICS. The DTP analysis reveals a threshold effect, with FI significantly enhancing HD both above and below the identified thresholds. Policy implications emphasize the importance of improving FI levels and achieving a certain income level to maximize the benefits of FI for HD.

Kais Tissaoui, Abdelaziz Hakimi, Taha Zaghdoudi