Islamic capital market-growth nexus pre and post IFSA 2013: empirical evidence from Malaysia
This study examines the relationship between Islamic capital market and Malaysian real economic growth pre and post IFSA 2013 from 2007 to 2019. This study adopts both quantitative and qualitative analysis, where Autoregressive Distributed Lag (ARDL) method of cointegration is adopted for the quan...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Centre for Research on Islamic Banking & Finance and Business (CRIBFB)
2023
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/104596/2/104596_Islamic%20capital%20market-growth.pdf http://irep.iium.edu.my/104596/ https://cribfb.com/journal/index.php/ijibfr/article/view/1996 |
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| Institution: | Universiti Islam Antarabangsa Malaysia |
| Language: | English |
| Summary: | This study examines the relationship between Islamic capital market and Malaysian real economic growth
pre and post IFSA 2013 from 2007 to 2019. This study adopts both quantitative and qualitative analysis,
where Autoregressive Distributed Lag (ARDL) method of cointegration is adopted for the quantitative
analysis, while interview session is adopted for the qualitative analysis. The findings found that the link
between Shari’ah-compliant Securities (SCS) and the real economic growth is negatively significant,
while the link between Shari’ah-compliant Market Capitalization (SCMC) and the real economic growth
is positively significant in both short and long runs. It is also shown that IFSA 2013 does assist the Islamic
capital market sector to improve the real economic growth in Malaysia via its rules and regulations, as
the coefficients and significance of the real economic growth as proxied by the industrial production index
(IPI) are improving with the implementation of IFSA 2013. Besides, the qualitative results of the study
have shown that Islamic capital market does promote economic growth by ensuring stability in the market
and significantly contributing to the environmental, social and governance (ESG) via the implementation
of SRI Sukuk, Bond Grant Scheme, ESG Financing/Sukuk, and value-based judgement projects. The work
gives some insights into the field of Islamic capital market-growth nexus from the perspective of a
developing country, which is Malaysia. It also delves further into the Islamic capital market-growth nexus
by considering the effect of IFSA 2013. |
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