Journal of Islamic Monetary Economics and Finance (JIMF)
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Islamic Label and Stock Price Crash Risk
Full text linkThis study explores how an Islamic label on firms influences stock price crash risk in Indonesia. We utilize a sample of 566 nonfinancial firms listed between 2016 and 2021, apply panel data method, and find that the Islamic label benefits the firms by lowering crash risk. Investors consider firms with the Islamic label as lower risk due to leverage constraints they must adhere to, which contributes to a decreased crash risk. Our primary results are robust to various sensitivity analyses. We also find that dividend policy and audit quality strengthen the Islamic label-crash risk nexus. The COVID-19 pandemic weakens the link between the Islamic label and crash risk. Furthermore, the Islamic label-crash risk nexus persists for up to two years.
What Has Been Discussed on Zakat Institutions? A Bibliometric Study
Full text linkThis study conducts a comprehensive bibliometric analysis of research on zakat published between 2011-2024 with the aims to map its intellectual structure, thematic evolution, and collaboration networks. Using science mapping principles, 312 documents from Scopus database are analyzed through co-authorship, citation counts, co-occurrence patterns, thematic analysis, and network visualization using R-based bibliometrix package and biblioshiny interface with AI-assisted visualization. Results reveal five distinct thematic clusters: social and psychological aspects of zakat compliance; digital transformation and technology adoption; institutional efficiency with Malaysian focus; financial governance and accountability; and macro-level zakat management in Indonesia. The field demonstrates remarkable growth with a 28.29% annual growth rate, dominated by Malaysian and Indonesian institutions accounting for over 65% of publications. Research evolution shows a progression from foundational governance issues (2011-2016) to strategic management (2016-2020) and contemporary digital innovation (2020-2024). The study identifies significant research gaps, particularly the absence of in-depth qualitative methodologies and limited cross-country comparative studies. This study offers novel insights into the evolution of zakat governance and highlights the need for interdisciplinary and cross-regional research to strengthen institutional relevance and inclusivity in zakat management.
ACKNOWLEDGMENT
The authors received the support funding for research, authorship and publication of this article from The Indonesian Education Scholarship (Beasiswa Pendidikan Indonesia), Center for Higher Education Funding and Assessment (Pusat Pelayanan Pembiayaan dan Asesmen Pendidkan Tinggi), Ministry of Higher Education, Science, and Technology of Republic Indonesia, and Endowment Fund for Education Agency (Lembaga Pengelola Dana Pendidikan).
The authors gratefully acknowledge the support and facilities provided by UPT Perpustakaan Universitas Brawijaya in the completion of this article
What Factors Influence the Welfare of Zakat Beneficiaries?
Full text linkThis study investigates the influence of demographic, social, and economic variables on the welfare of zakat beneficiaries in West Java, Indonesia. Using a sample of 1,300 zakat beneficiaries, the paper applies the Chi-square Automatic Interaction Detector (CHAID) method. Our findings suggest the crucial role of monitoring by amil institutions in the respective areas on the improvement of material and spiritual conditions of zakat beneficiaries. The study suggests that amil plays a major part in the success of zakat distribution programs and the programs should be further enhanced for the betterment of zakat beneficiaries. This study also shows that apart from zakat distribution programs, there are also some demographic, social, and economic variables that affect the income and spiritual conditions of zakat beneficiaries
Why Do People See a Financial System as a Whole Very Important?
No full textThe action of one person will affect the others and then the action of one country will affect other countries. Financial crisis is like a contagious disease, which spreads everywhere. The failure in capturing systemic risk is the interconnected market events (’network externalities’) can produce self-reinforcing cycles then create the harmful situation. What happened in the banking regulation particularly Basel II? In reality, Basel II did not work completely in 2008. Since the implementation of risk management based on Basel II has been a prerequisite for a bank, it is supposed to make a positive impact. Misplaced reliance on mathematical model and statistics in managing risk could one of the problems in the decision making process. Using system thinking, system dynamics paradigm and theory of feedback system, this paper tries to see the risk management from different perspective and to enrich the understanding of how financial systems work: what drives them and causes the behavior. Many lessons can be learnt from this financial contagion since Islamic banking and finance system has inevitably been a part of the international financial systems. 
Sharia Supervisory Board, Board Attributes and Real Earnings Management in Islamic Banks
Full text linkThis study examines how the Sharia Supervisory Board (SSB) moderates the effects of Board of Directors (BOD) characteristics on real earnings management (REM) of Islamic banks. Using unbalanced data encompassing 45 Islamic banks across 15 countries from 2012 to 2023, it documents a negatively significant influence of board size, independence, and expertise on REM. The influence of board's diligence, however, is absent. The study further notes that the SSB index moderates the effect of BOD attributes on REM in Islamic banks. The findings hold important implications for policymakers and regulators in shaping regulations on SSB and BOD oversight functions to curb REM practices. The study also contributes to the literature by offering further empirical evidence on the relationship between corporate governance and REM in Islamic banks.  
The Role of Deposit Insurance in Supporting Islamic Microfinance Institutions: Insights from Indonesia
Full text linkThis study assesses the necessity of a Deposit Insurance System (DIS) for Islamic Microfinance Institutions (IMFIs). It first identifies key factors influencing knowledge of DIS among stakeholders and then proceeds to evaluate the social impact of IMFIs and examine the urgency for a DIS and respondents' willingness to pay deposit insurance premiums. Conducting survey using purposive sampling, we obtain required data for the analysis from 405 respondents. Applying the logistic regressions, we find reveal that education, work experience, and financial behaviors influence DIS awareness. The findings underscore the urgency of implementing DIS to bolster stakeholder trust and financial system stability, with respondents expressing willingness to contribute premiums. These insights contribute to designing a Shariah-compliant DIS that aligns with the unique operational characteristics of IMFIs, supports sustainable industrialization, and advances SDG-9 goals. The study highlights actionable pathways for policymakers, regulatory bodies, and IMFI managers to foster a resilient and inclusive financial ecosystem.
ACKNOWLEDGEMENT
Special thanks to the National Committee of Islamic Economic and Finance of the Republic of Indonesia and Universitas Airlangga for the financial assistance. Universitas Airlangga through International Research Collaboration Scheme Top #500, Airlangga Research Fund, Year 2023, Universitas Airlangga, No: 359/UN3.15/PT/2023
Information Asymmetry and Religious Seasonality
Full text linkThis paper examines the seasonality in information asymmetry as proxied by the probability of informed trading (PIN) in relation to the Islamic holy month of Ramadan. It utilizes data collected from Boursa Kuwait, covering the period from January 2013 to December 2018, and pooled panel regressions to test the hypothesis that increasing religiosity during Ramadan would reduce the probability of informed trading. The results reveal that the PIN increases during Ramadan relative to other Islamic calendar months, contrary to our hypothesis. Further tests reveal that institutional trading activities increase during Ramadan compared to individual trading. We argue that the presence of sophisticated traders (institutional traders) in the market during Ramadan contributes to the observed increase in the PIN effect. This study contributes to the literature by exploring the relationship between religiosity and information asymmetry in the context of an Islamic financial market, offering new insights into the behaviour of institutional traders during the holy month of Ramadan. We refer this phenomenon as the “Ramadan PIN effect”, which differs from the previously documented "Ramadan returns effect" and "Ramadan liquidity effect"
Sharia-Compliant Deposit Insurance and Deposit Flows: Evidence from a Dual Banking Market
Full text linkWe investigate whether the introduction of Islamic Deposit Insurance (IDI) affects deposit flow of and the pricing by Islamic banks vis-à-vis conventional banks for the case of Indonesia. Using December 2014 announcement of a separate deposit insurance scheme for Indonesia’s Islamic and traditional banks into two different funds as an exogenous event, we employ a difference-in-differences (DID) framework using matched bank-level data from 18 Islamic and conventional banks, comparing periods before and after the policy announcement. Our findings indicate that the announcement significantly boosts the growth of small deposits in Islamic banks compared to traditional banks, with an apparent increase in deposit growth after separating deposit insurance funds
Is Impulsive Buying for Muslim Fashion Products Invariably Followed by Post-Purchase Regret? The Role of S-O-R Theory
Full text linkThe growth of e-commerce has not only expanded the Muslim fashion industry but also fostered impulsive buying among customers. This article analyses the behaviour of Muslim customers using the S-O-R model to detect impulsive buying and subsequently post-purchase regret. In the analysis, we consider the role of religiosity in the link between the two. We collect data via self-administered questionnaires from 312 Muslim respondents and apply Partial Least Square structural equation modelling (PLS-SEM) to analyse the data using AMOS version 24.0. The results suggest that scarcity cues, fear of missing out, and live commerce have a significant influence on impulsive buying. Additionally, scarcity cues can lead to fear of missing out, based on their positive worth. The impulsive buying also invariably culminates in post-purchase regret. However, religion weakens the link between impulsive buying and post-purchase regret. Religiosity also reduces post-purchase regret. The results of our study can help authorities in understanding purchasing behavior of Muslims and consequently crafting initiatives to encourage purposeful purchase of fashions by Muslims
Developing Islamic Banking Performance Measures Based on Maqasid al-Shari’ah Framework: Cases of 24 Selected Banks
No full textIslamic banking has achieved remarkable growth that has surpassed the growth of the conventional banking system. Yet, studies show that the performances of Islamic banks (IBs) seem to be trailing behind the conventional banks (CBs). Is the poor performance of IBs the result of mismatch between their objectives and their performance measurement criteria or it is a reflection of their true performances? The objectives of Islamic banking had not been formally addressed. Mustafa and Taib (2009) derived the objectives of Islamic banking from Abu Zahara’s theory of the objectives of Shari’ah (Maqasid al-Shari’ah) and, based on these Shari’ah objectives, developed a model of Islamic banking performance measures. They named it as Performance Measures based on Maqasid al-Shari’ah framework or the PMMS model. This paper has tested the PMMS model on a sample 24 banks (12 IBs and 12 CBs). The twenty four banks were also evaluated using the traditional conventional financial measures. Mann-Whitney U-Test results show IBs faring well in their performances when measured using the PMMS model than when they are measured using the conventional banking performance yardstick. Policy prescriptions and recommendations for further studies are provided at the concluding section of the paper.