IDEAS home Printed from https://ideas.repec.org/a/idn/jimfjn/v8y2022i1cp49-64.html
   My bibliography  Save this article

The Role Of Pls Financing On Economic Growth: Indonesian Case

Author

Listed:
  • Masrizal

    (Islamic Economic Department, Faculty of Economics and Business, Universitas Airlangga, Indonesia)

  • Budi Trianto

    (Sekolah Tinggi Ekonomi Islam (STEI) Iqra Annisa Pekanbaru, Indonesia)

Abstract

This paper investigates the role of PLS financing and non-PLS financing of Islamic banks in supporting the real sector for the case of Indonesia using monthly data from January 2009 to December 2018. Applying the ARDL approach to model their long-run and short-run relations, we find positive contribution of the PLS financing scheme to Indonesia’s economic growth. Comparing the PLS and non-PLS financing, we note that the PLS financing has a larger impact on growth, both in the long run and short run. Accordingly, for Islamic finance to have larger growth impact, concrete steps and initiatives must be put in place to increase Islamic financing based on PLS arrangements.

Suggested Citation

  • Masrizal & Budi Trianto, 2022. "The Role Of Pls Financing On Economic Growth: Indonesian Case," Journal of Islamic Monetary Economics and Finance, Bank Indonesia, vol. 8(1), pages 49-64, February.
    • Handle: RePEc:idn:jimfjn:v:8:y:2022:i:1c:p:49-64
    DOI: https://doi.org/10.21098/jimf.v8i1.1378
    as

    Download full text from publisher

    File URL: https://jimf-bi.org/index.php/JIMF/article/view/1378/886
    Download Restriction: no
    File URL: https://libkey.io/https://doi.org/10.21098/jimf.v8i1.1378?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Elida Elfi Barus & Murah Syahrial & Evan Hamzah Muchtar & Budi Trianto, 2024. "Islamic Financial Literacy, Islamic Financial Inclusion and Micro-Business Performance," Remef - Revista Mexicana de Economía y Finanzas Nueva Época REMEF (The Mexican Journal of Economics and Finance), Instituto Mexicano de Ejecutivos de Finanzas, IMEF, vol. 19(1), pages 1-24, Enero - M.
    2. Siti Mujiatun & Budi Trianto & Eko Fajar Cahyono & Rahmayati, 2023. "The Impact of Marketing Communication and Islamic Financial Literacy on Islamic Financial Inclusion and MSMEs Performance: Evidence from Halal Tourism in Indonesia," Sustainability, MDPI, vol. 15(13), pages 1-20, June.

    More about this item

    Keywords

    Islamic banking; PLS financing; Non-PLS financing; Economic growth; ARDL;
    All these keywords.

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:idn:jimfjn:v:8:y:2022:i:1c:p:49-64. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lutzardo Tobing or Jimmy Kathon (email available below). General contact details of provider: https://edirc.repec.org/data/bigovid.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.