ANALISIS KONTRIBUSI ISLAMIC BOND MARKET TERHADAP FINANCIAL DEEPENING INDONESIA

The development of a country's financial sector has an important role in a country's economic growth. The development of the financial sector is divided into two conditions, namely a deep financial sector (Financial Deepening) and a shallow financial sector (Shallow Finance). The research is done to find whether Indonesia’s Islamic Bond Market has impact on Financial Deepening level or not. Vector Error Correction Model (VECM) method is used to estimated the research model. The independent variable of this research is Financial Deepening, which can be measured by the ratio of the amount of money spent (M2) to the gross domestic product (GDP). Meanwhile, the independent variables in this study are SBSN and Corporate Sukuk. Based on data from January 2011 to July 2020, It was found that the SBSN and Corporate Sukuk variables had a positive effect on the level of financial deepening in Indonesia. Based on the results of the VECM test, the variable of financial movement in responding to the variables will be stable for the next 10 periods