Abstract

In the economies, the increase in depth, access and efficiency of financial markets and institutions has emerged the need of examining the impact of financial development on income inequality. In this paper, the impact of financial development on income inequality, particularly in banking and capital market, has been examined via ARDL Bound Test approach by using the data, between the years 1993-2016, of Turkey. According to the results obtained from this approach, it has been concluded that the development of the banking system, even its effects are less than capital market, reduces income inequality.