IDEAS home Printed from https://ideas.repec.org/a/ris/dipjoe/021693.html
   My bibliography  Save this article

The Role of Islamic Financial Literacy in Shaping Economic Behavior: Evidence from Generation Z

Author

Listed:
  • Putri Muninggar

    (Faculty of Islamic Economics and Business, UIN Sunan Kalijaga, Yogyakarta, Indonesia)

  • Moh Shadam Taqiyyuddin Azka

    (Faculty of Business and Economics, Universitas Islam Indonesia, Yogyakarta, Indonesia)

  • Furqonul Haq

    (Faculty of Islamic Economics and Business, UIN Sunan Kalijaga, Yogyakarta, Indonesia)

  • Ahmad Febriyanto

    (Faculty of Economics and Business, Universitas Sebelas Maret, Surakarta, Indonesia)

Abstract

This study aims to examine the influence of Islamic financial literacy on the financial management behavior of Generation Z in Indonesia by extending the Theory of Planned Behavior (TPB). It explores how Islamic financial literacy shapes individuals’ attitudes, subjective norms, and perceived behavioral control, which subsequently influence their Sharia-compliant financial decisions. This research employs a quantitative approach, specifically using Structural Equation Modeling-Partial Least Squares (SEM-PLS) analysis. The findings reveal that Islamic financial literacy significantly enhances attitudes, subjective norms, and perceived behavioral control, all of which positively influence Islamic financial management behavior. This behavior is closely linked to improved financial decision-making, including saving habits, ethical investment choices, and long-term financial stability. By promoting Islamic financial literacy, this research highlights potential policy interventions to enhance financial inclusion and encourage participation in the Sharia-compliant financial sector. Strengthening financial capabilities among Generation Z can contribute to broader macroeconomic goals, such as reducing vulnerability to financial shocks and fostering equitable economic growth. This study contributes to the literature by extending the Theory of Planned Behavior to the Islamic financial context, specifically focusing on a generational cohort that will play a critical role in the future of Indonesia's Islamic economy.

Suggested Citation

  • Putri Muninggar & Moh Shadam Taqiyyuddin Azka & Furqonul Haq & Ahmad Febriyanto, 2025. "The Role of Islamic Financial Literacy in Shaping Economic Behavior: Evidence from Generation Z," Diponegoro Journal of Economics (DJOE), Faculty of Economics and Business, Universitas Diponegoro, vol. 14(2), pages 081-097.
    • Handle: RePEc:ris:dipjoe:021693
    DOI: 10.14710/djoe.48925
    as

    Download full text from publisher

    File URL: https://ejournal3.undip.ac.id/index.php/jme/article/view/48925/34312
    Download Restriction: None
    File URL: https://libkey.io/10.14710/djoe.48925?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
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • G53 - Financial Economics - - Household Finance - - - Financial Literacy

    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:ris:dipjoe:021693. 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: Aris Munandar (email available below). General contact details of provider: https://edirc.repec.org/data/efdipid.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.