Financial Sector Development and the Millennium Development Goals

This book can be purchased at the World Bank website.This study investigates the relationship between financial sector development and progress in reaching the Millennium Development Goals (MDGs).We assess the contribution of countries' financial sector development to achieving the MDGs. We focus on the relationships between financial development and economic welfare and growth, and the following four MDG themes: Poverty, Education, Health, and Gender Equality. In doing so, we review the theoretical channels, survey existing empirical evidence - both cross-country and case study evidence - and provide new evidence.We find that financial development is an important driver for economic welfare in that it reduces the prevalence of income poverty and undernourishment. In addition, we provide new evidence of a positive association between financial development and health, education, and gender equality