This study provides a comprehensive review of existing research on the impact of Islamic finance (IF) on economic growth. The purpose of this study is to provide a comprehensive overview of the state of knowledge in this field, summarizing key trends, themes and findings from studies published in prestigious journals.
The authors conduct a bibliometric analysis to assess the development, structure and key themes in the relationship between IF and economic growth, using data from the Scopus database from 2009 to December 2023.
This review shows that Islamic finance has a strong positive correlation with economic growth in most of the nations studied, supporting the supply-leading hypothesis. However, some scholars highlight concerns regarding the existence of only a long-term relationship, while others report mixed findings, including empirically weaker associations.
Strong support for the supply-leading hypothesis highlights the need to advance IF for economic growth. Policymakers should improve Islamic financial infrastructure and regulations. Investments in Islamic financial instruments, like Sukuk, are advantageous.
IF can play a crucial role in addressing social issues, such as poverty alleviation and equitable wealth distribution.
By combining bibliometric analysis with a focused review of empirical studies, this paper offers a novel perspective on research linking IF and economic growth. This study identifies key trends, regional patterns and core journals, while categorizing studies based on their findings to provide fresh insights into this relationship.
