Impact of income inequalities on credit growth:

The most recent episodes of financial crises have put forward the idea that credit booms are the main reason for financial disequilibrium. Taking that into account, we will explore the track of income inequalities as a trigger for credit booms in both advanced and emerging economies. While a large literature on the subject gives evidence for a positive relationship between income inequalities and credit growth, we find no relationship between the two in advanced economies, except for the period of the Great Moderation. For emerging economies, income inequalities are not a determinant of credit growth. “Traditional” determinants of credit growth in advanced economies cannot be transposed to the case of emerging economies.