Is there evidence that hard inquiries increase income inequality?
Hard inquiries (like ones done during loan applications) hurt your credit score by a few points. Is there any substantial evidence that this makes poorer people poorer, since if they get rejected, it makes them look like a worse borrower and a vicious cycle can start? I'm curious if this actually has any statistically significant effect and couldn't find an answer with a quick google.
I don't believe the rejection would be added to your credit report. The single inquiry would decrease your score by 1-3% for a month. It's a very small amount, but maybe it compounds if you are making 20 loan applications or something like that.
What really hurts applicants is when a loan company asks about things outside of the credit report that you are legally compelled not to lie about, such as "Have you EVER been bankrupt?" even if it was 20 years ago.
Getting rejected does not impact your fico score, though the inquiry will for a limited time.