The Rise of Islamic Insurance (Takaful) and Impact on Economic Growth: A Multi-country Study

Ibrahim Muhammad Muye, Ahmad Fahmi S. Hasan and Yusuf Karbhari ()
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Ibrahim Muhammad Muye: Tashkent State University of Economics
Ahmad Fahmi S. Hasan: School of Business and Economics, UPM
Yusuf Karbhari: Cardiff University

Chapter Chapter 14 in Islamic Financial Markets and Institutions, 2025, pp 301-315 from Springer

Abstract: Abstract This study examines the global expansion of Takaful insurance and evaluates its impact on economic development in 22 Muslim-majority countries. Utilizing the difference GMM technique, we find strong evidence of a positive and significant effect from the Takaful sector on economic growth. We report a robust positive and significant link between trade and a positive but insignificant relationship between CPI and economic growth with government consumption being negative. Our results provide support for the supply-leading hypothesis in the finance growth literature. We conclude that this alternative form of insurance is an important catalyst for economic development.

Keywords: Takaful; Financial development; Economic growth; Dynamic GMM technique; Islamic finance (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-981-96-8650-6_14

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DOI: 10.1007/978-981-96-8650-6_14

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