IDEAS home Printed from https://ideas.repec.org/a/eme/jiabrp/jiabr-03-2021-0107.html
   My bibliography  Save this article

Islamic finance and economic growth nexus: an empirical evidence from Southeast Asia using dynamic panel one-step system GMM analysis

Author

Listed:
  • Mohammed Ayoub Ledhem
  • Mohammed Mekidiche

Abstract

Purpose - This paper aims to empirically explore the nexus between Islamic finance and economic growth across Southeast Asia based on the perception of the endogenous growth model. Design/methodology/approach - This paper applied the dynamic panel one-step system GMM as an optimum estimation approach to study the influence of Islamic finance on economic growth in Southeast Asia from 2013Q4 to 2019Q4. This paper used total Islamic financing as the major exogenous explanatory factor inside the endogenous growth model, whereas the gross domestic product was used as the measurement of economic growth. The sample consisted of all complete Islamic banks operating in Southeast Asia (Malaysia, Brunei Darussalam and Indonesia). Findings - The findings demonstrated that Islamic finance is promoting economic growth in Southeast Asia, which reflects the weighty role of Islamic finance as an energetic contributor to economic growth. Practical implications - This paper would enrich the literature by studying the nexus between Islamic finance and economic growth in Southeast Asia based on the perception of endogenous growth model, as the results of this paper assist as an attendant for financial scholars, decision-makers and policymakers to expand Islamic finance globally as an alternative funding source for the best involvement to economic growth. Originality/value - Despite the existing studies on the nexus between Islamic finance and economic growth, this paper is the first that explores empirically the nexus between Islamic finance and economic growth in Southeast Asia based on the theoretical background of the endogenous growth model to obtain solid information on this nexus.

Suggested Citation

  • Mohammed Ayoub Ledhem & Mohammed Mekidiche, 2021. "Islamic finance and economic growth nexus: an empirical evidence from Southeast Asia using dynamic panel one-step system GMM analysis," Journal of Islamic Accounting and Business Research, Emerald Group Publishing Limited, vol. 12(8), pages 1165-1180, August.
    • Handle: RePEc:eme:jiabrp:jiabr-03-2021-0107
    DOI: 10.1108/JIABR-03-2021-0107
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/JIABR-03-2021-0107/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://www.emerald.com/insight/content/doi/10.1108/JIABR-03-2021-0107/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1108/JIABR-03-2021-0107?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Reenu Kumari & Sunil Kumar Singh, 2024. "Impact of ICT Infrastructure, Financial Development, and Trade Openness on Economic Growth: New Evidence from Low- and High-Income Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 7069-7098, June.
    2. Chiad, Faycal & GHERBI, Abdelhalim, 2024. "The Role of Islamic Banks in Promoting Economic Growth and Financial Stability: Evidence from Saudi Arabia," MPRA Paper 122409, University Library of Munich, Germany.
    3. Ifeanyi J. Ozulumba, PhD Candidate & Amaka G. Metu & Geraldine Nzeribe, 2024. "An Evaluation of the Impact of Migration on Human Capital Development: Evidence from the ECOWAS," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(7), pages 1086-1095, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:jiabrp:jiabr-03-2021-0107. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.