Assimilating Islamic Banking Customer Loyalty: A Halal Brand Personality Perspective Model

As Indonesian government promotes Indonesia as the center of the Halal Industry Nation, numerous strategies are being implemented across every sector, including Islamic Financial Institution. This research focuses investigating factors that can influence customer loyalty. To bridge this gap, the study aims to create a model for increasing customer loyalty based on the Halal Brand Personality approach, by exploring competitive advantage as a mediating variable. This research is considered important due to the relatively small market share of Islamic banking in Indonesia, which faces intense competition. This is an explanatory research with a quantitative approach that employs survey method to collect 225 data points. Structural Equation Modeling (SEM) is used to analyze the direct and indirect relationship of each variable. It was found that from all the hypotheses, six were rejected, and the model was validated. The result delineated that the model proposed in this research can assist branch managers in maximizing and strengthening Islamic banking’s distinctive products and sophisticated technology, which are its primary competitive advantages when competing with other banking sectors.JEL Classification: M20, M21, M31How to Cite:Sarassina, R. R. F., Furwanti, R., & Lestari, D. M., (2023). Assimilating Islamic Banking Customer Loyalty: A Halal Brand Perspective Model. Etikonomi, 22(2), 247 – 262. https://doi.org/10.15408/etk.v22i2.31566

Volatility Connectedness of MOVE Index and Bond Returns

Research Originality: To the best of our knowledge, this is the first study which measures the impact of the MOVE index on bond yield volatility by comparing its effect on both short-term and long-term. The paper contributes to the existing literature by providing a better understanding of the relationship between maturity and volatility spillover. Research Objectives: This study examines the dynamic volatility connectedness between 2 and 10-year bond yields and the MOVE Index. Furthermore, it is aimed at detecting the transmitter of volatility among variables. Research Methods: Using a data set from 2010 to 2022, the study utilizes a Time-Varying Parameter Vector Autoregression (TVP-VAR) model to analyse the dynamics and relationship between bond yields and the MOVE Index. Empirical Results: The study finds a significant volatility spillover between the MOVE Index and Türkiye's bond yields. Notably, the linkage between the MOVE Index and the 10-year bond rates is stronger than with the 2-year rates. Additionally, the MOVE Index emerges as the primary transmitter of volatility, impacting both bond yields. Implications: This study sheds light on the complexity and dynamics of volatility spread in Türkiye's bond market, providing essential insights for forecasting bond yields and shaping financial policies.JEL Classification: G17, C22, G12How to Cite:Baykut, E., Gökgöz, H. (2024). Volatility Connectedness of MOVE Index and Bond Returns. Etikonomi, 23(1), 27 – 46. https://doi.org/10.15408/etk.v23i1.36131

Should Islamic Window be converted into a Full-Fledge Islamic Bank? A case study in Indonesia

Research Originality: This research provides fresh perspectives on the future landscape of Islamic banking, particularly concerning the Islamic window. The paper stands out for its originality as it undertakes an empirical study utilizing a mixed method. This study is also expected to answer the research gap between literature studies, empirical studies, and implemented policies. Additionally, it is driven by the objective of contributing to the existing literature on Islamic finance.Research Objectives: This study dives into whether converting Islamic Business Units (UUS) into full-fledged Islamic Banks (BUS) leads to performance enhancement.Research Methods: There are two types of data analysis methods, namely qualitative and quantitative. The qualitative analysis method comes from a collection of literature reviews and institutional opinions from Islamic banking experts in the world. This study employs a multi-pronged quantitative approach to investigate the performance and consumer perception of Islamic banking services with an emphasis on UUS and BUS.Empirical Result: The results indicate that UUS and BUS structures adhere to Sharia principles and achieve commendable performance. However, analysis of financial reports across many countries, including Indonesia, shows that UUS's financial performance is generally better than BUS. The research further emphasizes that internal factors like capital adequacy, asset quality, and management capabilities, rather than the institutional structure itself, hold greater sway in driving performance improvement. Forced conversion of UUS could even hinder overall progress. Implications: Beyond financial considerations, the study explores consumer behavior through surveys with educated individuals. The results indicate that their choice between BUS and UUS products is guided by practical factors such as financial returns, costs, and service reliability offered by each structure. JEL Classification: G21, G28 How to Cite:Abimanyu, A., & At Tamimi, R. A. (2024). Should Islamic Window be Converted into a Full-Fledge Islamic Bank? A Case Study in Indonesia. Etikonomi, 23(1), 183 – 200. https://doi.org/10.15408/etk.v23i1.35082

Unleashing the Central Bank Digital Currency Revolution and its Impact on Exchange Rate: A Monetary Approach Synthesis

Research Originality: The introduction of CBDC by the Central Bank of Indonesia has increased the intensity of news about CBDC. Besides aiming to introduce the future direction of the payment system, the news potentially causes uncertainty and speculation in the market, which may impact the rupiah exchange rate.Research Objectives: This research analyzes the impact of CBDC news on the rupiah exchange rate, synthesizing a sticky price version of the monetary approach to the exchange rate. Research Methods: A CBDC News Index is constructed based on a compilation of news data from major online media between 2018 and 2023. The structural VAR (SVAR) method is thenemployed to investigate the impact of CBDC news on the exchange rate dynamic.Empirical Results: The results suggest a trend consistent with the hypothesis, indicating that news about CBDC may lead to pressure on the domestic currency, resulting in depreciation. However, the impact is not statistically convincing as the coefficient is not statistically different from zero. The monetary approach synthesis findings suggest that raising the policy rate is likely efficacious in counteracting the pressure of domestic currency depreciation. Meanwhile, other monetary approach variables exhibit anomalies related to exchange rate dynamics.Implications: As the central bank plans to implement a Central Bank Digital Currency (CBDC), it must carefully control the dissemination of information about what the CBDC will entail and how it will be rolled out. CBDC blueprint and official disclosure help reduce uncertainty and speculation about implementing CBDC.JEL Classification: D80, E58, F31How to Cite:Kurnia, A. S. & Assidiq, M. A. (2024). Unleashing the Central Bank Digital Currency Revolution and Its Impact on Exchange Rate: A Monetary Approach Synthesis. Etikonomi, 23(2), 271-286. https://doi.org/10.15408/etk.v23i2.3778

Effect of Individual Attributes toward Financial Management Behavior through Locus of Control

Only a few studies have examined the use of comprehensive variables in determining financial management behavior, though the model involves many other variables. Therefore, this study aimed to examine the locus of control as a mediator variable in the effect of financial attitude and knowledge, income, and spiritual intelligence on financial management behavior. It used a quantitative descriptive method and involved 391 respondents determined through convenience sampling. The results showed that financial attitude and spiritual intelligence significantly impact financial management behavior through locus of control. Whereas in the other two variables, namely financial knowledge, and income, the role of the mediator does not function effectively, so it does not have an indirect effect. These findings have implications for individuals to practice financial readiness in daily financial life. The information obtained also strengthens the role of self-control in financial management.JEL Classification: G40, G41How to Cite:Amri, A., Widyastuti, T., Bahri, S., & Ramdani, Z. (2023). Effect of Inidvidual Attributes toward Financial Management Behavior through Locus of Control. Etikonomi, 22(2), 443 – 456. https://doi.org/10.15408/etk.v22i2.26563

Factors Affecting Consumers' Comprehensive Vehicle Insurance Policy Purchasing Behavior

Research Originality: With increasing vehicle values in Türkiye and high insurance costs, consumers' vehicle insurance purchasing preferences emerge as a dilemma. The study examines consumers' insurance purchasing behavior in this dilemma's context of risk and overconfidence tendencies.Research Objectives: This study aims to reveal the effects of individual characteristics, attitude toward risk, and overconfidence tendencies on comprehensive vehicle insurance policy purchasing behavior.Research Methods: A questionnaire was administered to 428 selected vehicle owners in Turkey, and the questionnaire results were analyzed using the binary logit model.Empirical Results: The study found that gender, education level, income level, market value of the vehicle, attitude towards risk, and self-confidence level have statistically significant effects on comprehensive vehicle insurance policy purchase decisions.Implications: The relationship between risk-taking behavior, overconfidence, and insurance purchasing behavior requires further discussion. Government policies that increase insurance awareness are recommended to weaken this relationship.JEL Classification: D12, G22, C25How to Cite:Kutlu, M., Sumer Adin, S., Mola, H., & Şahin Kutlu, S. (2024). Analysis of Factors Affecting Consumers' Comprehensive Vehicle Insurance Policy Purchasing Behavior. Etikonomi, 3(2), 539 – 554. https://doi.org/10.15408/etk.v23i2.37807

The Contribution of Islamic and Conventional Banks to Financial Stability in Indonesia

This study aims to examine an asymmetric relationship between Islamic and conventional bank contributions to financial stability in Indonesia. Adopting non-linear autoregressive distributed lag (NARDL), the study utilizes time-series data from 2004m1-2021m9, consisting of financial stability as a dependent variable, proxied by non-performing loans (NPLs) and ZSCORE. Islamic and conventional banks as independent variables were measured by total financing and total assets. Furthermore, we used interest rates and inflation as complementary variables. The findings reveal that Islamic and conventional banks affect financial stability in the short and long run. However, conventional banks contribute to financial stability more than Islamic banks. The asymmetric relationship explains that an increase/decrease in the independent variables to the same degree does not have the same impact on the dependent variable. This research implies that the financial authorities need to increase their awareness of the presence of asymmetric relationships when designing monetary policy to achieve and maintain financial stability. Finally, the study also fills the current research gap by measuring the contribution of Islamic and conventional banks to financial stability from an asymmetric relationship viewpoint.JEL Classification: E60, G20, G21How to Cite:Fakhrunnas, F., Nahda, K., Chowdhury, M.A.M. (2023). The Contribution of Islamic and Conventional Banks to Financial Stability in Indonesia. Etikonomi, 22(1), 213–232. https://doi.org/10.15408/etk.v22i2.26656

The Probability of the Financing Sustainability of Micro-firms Supported by Islamic Social Fund

This study aims to identify factors that influence financing sustainability, thereby determining the probability of attaining the subsequent financing from Islamic social funds. Islamic social funds provide funding for micro-firms using a financing scheme that differs from conventional financing terms. For the lower level, Islamic social funds usually offer a limited amount of no-cost financing called qard. In contrast, for more profitable micro-firms, Islamic social funds provide low-cost financing called murabahah. However, most micro-firms need financing in sustainable terms, either using a qard scheme or a murabahah scheme. We assume that only micro-firms showing business growth may generate higher financing using the murabahah scheme. We use data from 1,346 micro-firms. We found several factors that contribute significantly to a micro-firm having a higher chance of generating further funding, such as group-type financing, amount of funding (plafond), time to maturity, and demographic aspects such as age and number of dependents. However, we found that the initial contract scheme. How to Cite:Hakim, A. & Dalimunthe, Z. (2022). The Probability of Financing Sustainability of Micro firms Financially Supported by Islamic Social Fund. Etikonomi, 21(1), 127-138. https://doi.org/10.15408/etk.v21i1.12316

Emotionally Intelligent Employees’ Work Outcomes: The Mediating Role of Organizational Commitment

The present study examines the effect of emotional intelligence on turnover intention and organizational indifference, noting the mediating role of organizational commitment. The current model of the study is considered one of the first attempts in examining these variables in the tourism industry. The structural equation modeling has been used to analyze the sample consisting of hotel department managers who have direct contact with the customers. According to the research results, emotional intelligence and organizational commitment decrease turnover intention and organizational indifference of the hotel department managers. In addition, emotional intelligence has been positively associated with the employees' organizational commitment. Finally, it has been found that organizational commitment mediates the effect of emotional intelligence on turnover intention and organizational indifference. Managers at the hotels should have the high emotional intelligence to establish empathy and perseverance to avoid being indifferent. In order to do this, hotel managers’ commitment should be increased to perceive their job as their own.How to Cite:Uzunbacak, H. H., Erhan, T., & Ak akanat, T. (2022). Emotionally Intelligent Employees’ Work Outcomes: The Mediating Role of Organizational Commitment. Etikonomi, 21(1), 11-40. https://doi.org/10.15408/etk.v21i1.20541

The Nexus among Agriculture Sector Development and Environmental Degradation in Emerging Economies

This paper aims to determine the effect of agriculture sectordevelopment on CO2 emissions in 10 big emerging marketeconomies. This relationship is tested for the first time for emergingeconomies by using the panel quantile regression approach. Theresults suggest that agricultural value-added mitigate emissionsin lower, middle-lower, and upper quantile levels. This resultimplies that the agricultural sector is an effective policy toolin reducing pollution in these countries. Economic growth andnatural resources rent have a positive impact on pollution. Financialdevelopment only has an emission-reducing effect at the middleupperquantile level, while globalization has a negative impact onCO2 emissions both in the middle-upper and upper quantiles.These results justify the consideration of heterogeneous effects andallow clear policy implications. Moreover, the critical importanceof agricultural policies for environmental quality in these countriesis emphasized with concrete evidence.JEL Classification: O13, Q56, C3