THE ROLE OF THE STATE IN ISLAMIC FINANCE DEVELOPMENT: A WORLDWIDE GOVERNANCE INDICATOR APPROACH
Article Sidebar
Main Article Content
Abstract
This research aims to empirically examine the institutional quality variable as a moderating
variable between macroeconomic stability and the development of global Islamic finance and
the indicators of global sukuk instruments. This is to prove previous research which states that
macroeconomic stability influences financial developments. Macroeconomic stability also
influences the development of the sukuk market. There is empirical research that states that
institutional quality moderate financial developments, so research is directed at examining
institutional quality as a moderator of macroeconomic stability in the development of the global
sukuk market. Exploratory quantitative research method, using secondary data panel data
models in the form of development of sukuk with proxies for issuance of sukuk in countries
that are active in issuing sukuk and registered on the International Islamic Financial Market
(IIFM), and institutional quality comes from WGI -BI. The results of the analysis show that the
quality of institutions moderates the macroeconomic stability of the development of sukuk,
especially on the exchange rate and inflation indicators. While the GDPP moderation test for
the development of sukuk there is no evidence that institutional quality is a moderating variable.
This research contributes empirically to the limitations of previous research which analyzed
macroeconomic stability without including the variable quality of government institutions
which can be used as a basis for making decisions for investors in investing, regulators in making
rules, and issuers when issuing sukuk.
Downloads
Article Details
References
ADB. (2005). Jalan Menuju Pemulihan: Memperbaiki iklim investasi di Indonesia.
Alam, A., & Yazdifar, H. (2019). Technological Forecasting & Social Change Institutional determinants of R & D investment?: Evidence from emerging markets., 138, 34–44. Retrieved from https://doi.org/10.1016/j.techfore.2018.08.007
Bhattacharyya, S., & Hodler, R. (2014). Do Natural Resource Revenues Hinder Financial Development?? The Role of Political Institutions. World Development, 57, 101–113. Retrieved from https://doi.org/10.1016/j.worlddev.2013.12.003
Cherif, M., & Gazdar, K. (2010). Institutional and Macroeconomic Determinants of Stock Market Development in Mena Region: New Results From a Panel Data Analysis. International Journal of Banking and Finance, 7(1), 139–159.
Cherif, M., & Gazdar, K. (2010). Institutional and Macroeconomic Determinants of Stock Market Development in Mena Region: New Results From a Panel Data Analysis. The International Journal of Banking and Finance, 7(1), 139–159.
Dequech, D. (2006). The new institutional economics and the theory of behaviour under uncertainty, 59, 109–131. Retrieved from https://doi.org/10.1016/j.jebo.2004.03.012
Effah, M., Adjasi, C. K. D., & Latif, A. (2016). Macroeconomic uncertainty , foreign direct investment and institutional quality?: Evidence from Sub-Saharan Africa. Economic Systems, 40(4), 612–621. Retrieved from https://doi.org/10.1016/j.ecosys.2016.02.010
Elgin, C., & Oztunali, O. (2014). Institutions , Informal Economy , and Economic Development Institutions , Informal Economy , and. Emerging Markets Finance and Trade, 50(4), 145–162. https://doi.org/10.2753/REE1540-496X500409
Elkarim, G. a. (2012). Factors Influence Sukuk and Conventional Bonds in Malaysia, 1–16.
Febrina, P., & S. (2014). Kelembagaan Terhadap Foreign Direct Investment Di Asean 6. Media Ekonomi, 22, 241–260.
Garcia, V. F., & Liu, L. (1999). Macroeconomic Determinants of Stock Market Development. Retrieved from https://doi.org/10.1080/15140326.1999.12040532
Huang, Y. (2010). Political Institutions and Financial Development?: An Empirical Study. World Development, 38(12), 1667–1677.
Ismail, A. G., & Ahmad, Z. (2016). Macroprudential Tools and Its Relationship with Monetary Policy Tools. In Macroprudential Regulation and Policy for the Islamic Financial Industry (pp. 245–272). Retrieved from https://doi.org/10.1007/978-3-319-30445-8
Jain, P. K., Kuvvet, E., & Pagano, M. S. (2017). Corruption’s impact on foreign portfolio investment. International Business Review, 26(1), 23–35. Retrieved from https://doi.org/10.1016/j.ibusrev.2016.05.004le
Kayed, R., & Mohamed, K. (2007). Unique Risks of Islamic Modes of Finance: Systematic, Credit and Market Risks. Journal of Islamic Economics, Banking and Finance, 5(3), 9–34.
Khan, M. A., Khan, M. A., Abdulahi, M. E., Liaqat, I., & Shah, S. S. H. (2019). Institutional quality and financial development: The United States perspective. Journal of Multinational Financial Management, 49, 67–80. https://doi.org/10.1016/j.mulfin.2019.01.001
Law, S. H., & Azman-Saini, W. N. W. (n.d.). Institutional quality, governance, and financial development. Economics of Governance, 13(3), 217–236. Retrieved from https://doi.org/10.1007/s10101-012-0112-z%0A
Manab, A., & Sujianto, A. E. (2016). Pengaruh Stabilitas Ekonomi makro terhadap Penerbitan Sukuk Negara di Indonesia, Malaysia, dan Brunei Darussalam. Tulungagung: Cahaya Abadi.
Mohamed, H. (2016). Early Warning Indicators and Macroprudential Policy Tools. In Macroprudential Regulation and Policy for the Islamic Financial Industry, 101–119. Retrieved from https://doi.org/10.1007/978-3-319-30445-8
Pagano, M., & Volpin, P. F. (2005). American Economic Association The Political Economy of Corporate Governance. American Economic Associat, 95(4), 1005–1030.
Reuters, T. (2017). SUKUK PERCEPTIONS & FORECAST STUDY 2017.
Rini, M. (2012). Obligasi syariah (sukuk) dan indikator makroekonomi indonesia?: Sebuah analisis vector error correction model (VECM).
Said, A., & Grassa, R. (2013). The determinants of sukuk market development: Does macroeconomic factors influence the construction of certain structure of sukuk? Journal of Applied Finance & Banking, 3(5), 251–267.
Sugiyono. (2012). Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung.
Sukirno, S. (2004). Makro Ekonomi Edisi Ketiga. Jakarta: Raja Grafindo Persada.
Vukovic, V. (2012). Book review: Why Nations Fail: The Origins of Power, Prosperity, and Poverty / Daron Acemoglu and James A. Robinson. Financial Theory and Practice, 321–328.
Wang, Y., Cheng, L., Wang, H., & Li, L. (2014). Institutional quality, financial development and OFDI. Pacific Science Review, 16(2), 127–132. Retrieved from https://doi.org/10.1016/j.pscr.2014.08.023
Wang, Y., Cheng, L., Wang, H., & Li, L. (2014). Institutional quality, financial development and OFDI. Pacific Science Review, 16(2), 127–132. https://doi.org/10.1016/j.pscr.2014.08.023
Yustika, A. E. (2012). Ekonomi Kelembagaan Paradigma, Teori, dan Kebijakan. Malang: Erlangga.