Islamic (Participation) Banking and Economic Growth: Empirical Focus on Turkey
Additional contact information
Gonca Atici: Istanbul University, School of Business, Business Administration, Avcilar Campus, Avcilar, Istanbul, Turkey
Asian Economic and Financial Review, 2018, vol. 8, issue 11, 1354-1364
The purpose of this study is to analyze the causal relationship between Islamic (participation) banking and economic growth in Turkey. A quarterly time-series data is employed from 2008:1 to 2018:1. Vector Error Correction Model (VECM) based Granger causality test is conducted to find evidence in support of ?supply-leading? or ?demand-following? hypothesis. Empirical results of the study suggest a significant uni-directional long-run causality from Islamic (participation) banking to economic growth that confirms the ?supply-leading? hypothesis. This finding is noteworthy as it emphasizes the crucial complementary role of Islamic (participation) banking besides conventional banking in Turkey. Findings draw attention to the fact that, efforts to improve the underlying regulatory system of Islamic (participation) banking will have positive contributions on growth. Besides, new business models/ Islamic banking window and diversified instruments are expected to position Turkey in a well-deserved place in the international Islamic banking industry.
Keywords: Islamic (participation) banking Economic; growth; Turkey; Granger causality; VECM; Supply-leading; Demand-following. (search for similar items in EconPapers)
JEL-codes: E02 E20 E60 G20 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:asi:aeafrj:2018:p:1354-1364
Access Statistics for this article
Asian Economic and Financial Review is currently edited by Dr. Qazi Muhammad Adnan Hye
More articles in Asian Economic and Financial Review from Asian Economic and Social Society 2637 E Atlantic Blvd #43110 Pompano Beach, FL 33062, USA.
Bibliographic data for series maintained by Chan Hoi Yan ().