PRODUCTIVITY AND DETERMINANT OF ISLAMIC BANKS EVIDENCE FROM INDONESIA
The present study aims at determining the level of productivity with indicators of Total Factor Productivity Change (TFPCH) or change in productivity and identify potential determinants of TFPCH of Islamic banks in Indonesia during the period 2011-2018. In the first stage, the Malmquist Productivity Index (MPI) to analyze the TFPCH of 8 Islamic banks operating during the 2011-2018 period. In the second stage, panel data regression was applied to assess the potential determinants of TFPCH. Research findings show that Indonesian Islamic banks experience productivity growth, and the Technical / Technological Change (TECHCH) component provide a significant influence on TFPCH growth and GDP and BI Rate variables are potential determinants of TFPCH. This research contributes to the renewal of the literature on the study of Islamic banking productivity performance in Indonesia, accompanied by specific determinants of the specific potential of private banks and macroeconomics of productivity, which is still limited to literature that addresses the topic.
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