IESTC WORKING PAPER SERIES

​#    ​​​Title ​  Authors
​​ ​​​November, 2019 ​
​ 06-2019 Impact of Islamic Religious Revenues on Economic Development across States in Malaysia  Abdul Ghafar Ismail

 

Abstract

The constitution makes a provision that they can expand the definition of Islamic finance for economic development agenda (e.g CBA and Federal Constitution). The definition also covers Islamic religious revenue. This study will present an empirical evidence on the effect of Islamic religious revenues on economic development. The results will examine the relationship between Islamic religious revenues and gross domestic product to substantiate whether the Islamic wealth’s hypothesis holds trues in the Malaysia context. The study covers the period from 1991 to 2017 and use panel data estimation to check the relationship among the variables. The results suggest that there exists a positive relationship between Islamic religious revenues and economic development. Hence, this study finds strong evidence for Islamic wealth’s hypothesis as well.

Keywords: Islamic religious revenues; economic development; wealth hypothesis; panel data analysis

JEL Classifications: H52; C22; O23; E62;