Islamic investment behaviour

Abstract

Purpose

In the past decade, there has been strong growth in Islamic finance and banking across the globe, there is little empirical evidence on the impact of religiosity on financial decisions. This paper aims to address this issue.

Design/methodology/approach

This paper uses an experimental design to investigate the investment behaviours of a group of Muslims.

Findings

The paper finds that Islam does influence investment behaviour, however, the degree to which it does this is influenced by the degree of religiosity of the individual. In addition, evidence is found of “Western style” wealth maximisation amongst Muslim investors as well as a desire to consider sustainable investment principles in asset allocations.

Research limitations/implications

These findings have implications for investors, financial advisors, and policy makers.

Originality/value

The paper is original its use of the experimental design to test the impact of religiosity in the context of investment decisions by Muslims.

Citation

Tahir, I. and Brimble, M. (2011), "Islamic investment behaviour", International Journal of Islamic and Middle Eastern Finance and Management, Vol. 4 No. 2, pp. 116-130. https://doi.org/10.1108/17538391111144515