An econometric analysis on participation banking and economic growth

This thesis investigates the relationship between participation banks and economic growth in Turkey, using a quarterly data set covering the period between 2006 and 2020. The findings show that a cointegration relationship between the variables exists. In other words, Islamic financing and economic growth move in tandem in the long run. In case of any deviation from the balance, it is found that 77% of the deviation is corrected in every quarter. Furthermore, it is shown that an increase of 1% of loans granted by participation banks generates an increase of 0,13% in growth.