Abstract
The financial sector is divided into two broad categories: equity and banking markets. The healthy functioning of these sectors plays an imperative role in any economy. This study aimed to examine the short-and long-term relationship between the Islamic financial sector (Islamic debt and Islamic equity market), and sustainable economic growth of the two economies with the largest Muslim populations. Quarterly data were collected from 2010 to 2019 for Indonesia and Pakistan. The study used autoregressive distributive lag (ARDL) and the error correction method (ECM). The results revealed that in the long run, the Islamic banking sector imparts a significant and positive effect on achieving sustainable economic growth in both countries. However, in the short run, the Islamic stock market was found to have a positive relationship with Pakistan, while the Islamic banking sector had a positive and significant relationship with economic growth in Indonesia.
| Original language | English |
|---|---|
| Article number | 8319 |
| Journal | Sustainability (Switzerland) |
| Volume | 13 |
| Issue number | 15 |
| DOIs | |
| State | Published - 1 Aug 2021 |
| Externally published | Yes |
Bibliographical note
Publisher Copyright:© 2021 by the authors. Licensee MDPI, Basel, Switzerland.
UN SDGs
This output contributes to the following UN Sustainable Development Goals (SDGs)
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SDG 8 Decent Work and Economic Growth
Keywords
- ARDL
- Bound test
- Islamic banking
- Islamic stocks
- SDG8
- Sharia banking
ASJC Scopus subject areas
- Geography, Planning and Development
- Renewable Energy, Sustainability and the Environment
- Environmental Science (miscellaneous)
- Energy Engineering and Power Technology
- Management, Monitoring, Policy and Law
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