Saudi Journal of Economics and Finance (SJEF)
Volume-2 | Issue-05 | 233-239
Original Research Article
The Effect of Islamic Capital Market Development on Economic Growth in Indonesia
Novita Sari, Syamsurijal AK, Marlina Widiyanti
Published : Oct. 30, 2018
Abstract
The purpose of the study is to find out whether there is a long-term and shortterm influence of the development of the Islamic capital market on economic growth in
Indonesia. The data used are monthly data from January 2011 to December 2017 with
Islamic stock variables, Islamic bonds (sukuk), and Islamic mutual funds as independent
variables, as well as economic growth as the dependent variable. This research uses longterm relationship and error correction models to see the existence of short-term
relationships. The results of this show are the significant positive influence between
corporate sukuk, the Jakarta Islamic Index and Islamic Mutual Funds on Economic
Growth in Indonesia. Whereas in the short term there is no influence between corporate
sukuk, the Jakarta Islamic Index, and Islamic Mutual Funds on Economic Growth in
Indonesia. Based on the results of the study, it can be implied that Islamic capital market
is able to become an alternative capital to increase economic growth in Indonesia with
long-term analysis using ECM.