payment facilities and income inequality; The threshold of financial development with an emphasis on the quality of governance in the Islamic Development Bank (ISDB)

payment facilities and income inequality; The threshold of financial development with an emphasis on the quality of governance in the Islamic Development Bank (ISDB)

Subject Areas : Financial Knowledge of Securities Analysis

Mohammad Alipour Shalamani ¹ , mohamadali dehghantafti ² , Seyed Yahya Abtahi ³ , jalil totonchi ⁴

1 - PhD student, Department of Economics, Yazd Branch, Islamic Azad University, Yazd, Iran
2 - Assistant Professor, Department of Economics, Yazd Branch, Islamic Azad University, Yazd, Iran. (Corresponding author)
3 - Assistant Professor, Department of Economics, Yazd Branch, Islamic Azad University, Yazd, Iran.
4 - Assistant Professor, Department of Economics, Yazd Branch, Islamic Azad University, Yazd, Iran

Received: 2024-05-13 Accepted : 2024-07-13 Published : 2025-07-22

Keywords: payment facilities, income inequality, financial development, governance quality, panel threshold approach model,

Abstract :

Purpose and background: The purpose of this article is to examine the relationship between payment facilities and income inequality despite the effects of the threshold of financial development with an emphasis on the quality of governance. Method: For this purpose, the panel threshold approach model (PSTR) was used based on the annual data of Islamic Development Bank (ISDB) member countries during the period 2000-2021. Findings: The estimation results of the non-linear part of the model show that there is a negative relationship between the variables of bank payment facilities, credits granted to the private sector, corruption control, quality of regulations, development of new technology, level of education and foreign direct investment with income inequality index. . Inflation rate variable has a significant positive effect on income distribution inequality in both linear and non-linear regimes. But the point that exists is the confirmation of the inverse relationship (U) between financial development and income distribution, which is positive and significant in the linear regime, and beyond the threshold (-0.21) and moving to the non-linear regime, the effect of granted credits The private sector is negatively affected by the inequality of income distribution. Conclusion: The financial system reduces transaction costs by obtaining information about investment opportunities, monitoring the investments made, accumulating savings, and facilitating exchanges, and by improving the appropriate allocation of financial resources in investment opportunities, it provides the necessary ground for reducing income inequality.

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