Financial development and economic growth in muslim countries an empirical evidence between islamic and conventional finance

Purpose: The main purpose of the study is to examine the effects of Islamic financial development and conventional financial development on economic growth, and compare the effects of these two, in six Muslim countries (Pakistan, Saudi Arabia, Malaysia, Qatar, Indonesia, and UAE). Methodology: Using panel data regression model, this paper engage different measures of financial development over the period 2001-2010. Findings: We will find that the conventional financial development has significant relationship with growth of economy, whereas Islamic financial development has positive but not significant relationship with economic growth in selected Muslim countries. Practical Implications: The effects with this paper suggest the requirement to increase the swiftness on the personal reforms intended for Islamic which have been introduced inside these kind of countries given that very least a couple 10 years as well as given that very last 10 years to improve your performance of such countries. Islamic financial system is to induce investment as well as, as a result, long-term economic increase. Originality: This specific analyze possesses various efforts to the recent researches. The paper analyze in which examines empirically the effects involving Islamic fund upon fiscal development inside Muslim countries. Likewise, that papers would be the few of them to compare different effects involving Islamic fund as well as typical fund upon fiscal development over a circumstance involving international locations finding the most produced Islamic economic climate on earth functioning side-by-side using a typical economic climate.