The Impact of Financial Development Indicators on Sukuk Issuances in Indonesia between 2005 and 2021, Using the Autoregressive Distributed Lag (ARDL)

Document Type : Research Paper

Authors

Faculty of Economics, University of Relizane, Relizane, Algeria.

10.22059/ier.2025.356387.1007670

Abstract

The recent financial development has witnessed the interest of many researchers and specialists in the field of Islamic finance due to the financial services and tools it provides that support the economy. Sukuk are one of the most important products of the Islamic financial industry because of their use in generating savings and raising funds to finance infrastructure projects and meet the requirements of economic development. The study aims to clarify the impact of indicators of financial development on the issuance of instruments in Indonesia between 2005 and 2021. To study the statistical relationship between the study variables, the issuances of instruments were relied upon as a dependent variable and the indicators of financial development as independent variables. (Real interest rate, private sector loans, money supply, investments) based on daddy growth of distruted time gaps, the resultats have demonstrated a morally positive impact for both private sector loans (DCPS) and Money Supply (M2) on SIs in the short term, and there is a moral positive impact for both investment (INV) and loans to the private sector (DCPS) on long-term issuances of instruments (SI). Finally, There is also stability in long and short-term milestones and therefore structural stability in the study model and the data used in the study do not have any structural changes, the study recommended the need to broaden the scope of instruments to ensure their dissemination and to look for factors promoting their development, to follow up on change in the financial system and to study their impact on the issuances of Islamic instruments in Indonesia.

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References

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Iranian Economic Review
Volume 29, Issue 2
June 2025
Pages 580-604

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