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This paper updates the literature regarding the performance of constrained US mutual funds by looking at the relative performance of Christian mutual funds, socially responsible funds and Islamic funds. This paper aims to rank the performance of religious and ethical investment funds.

This study uses monthly returns from 2005 to 2015 to perform traditional asset pricing models as well as data envelopment analysis to determine rank.

Islamic mutual funds outperform socially responsible funds, which then outperform Christian-based mutual funds; these results are also consistent during the latest 2007-2008 crisis period. The results are robust to different performance metrics and benchmarks. Moreover, this paper reports a significant amount of money “left on the table” by investing in constraint funds and disregarding the sin industry which shows an ethical dilemma for investors.

Investors who seek to invest morally/ethically can be informed of the cost of doing so. They can also compare portfolio with others that have similar holdings and constraints.

This paper not only includes Christian mutual funds in the research but also provides the performance of all constrained assets. It also compares religious funds with “SIN” industry, and thus quantifies the cost of “doing right.”

The global financial crisis of 2008 has put greater doubt on the bank risk-management effectiveness around the world. As a part of the response to such doubt, the Gulf Cooperation Council (GCC) region is formulating some feasible approaches to manage bank risk. In this regard, an understanding of the role of the region’s culture and economic freedom will provide immense input into this risk management approach. This study examines the impact of national culture and economic freedom on bank risk-taking behavior.

Data on bank risk measures, culture and economic freedom are obtained from the FitchConnect, World Bank database, Hofstede’s insights and Heritage Foundation. Generalized least squares and two step-system generalized method of moments are then used to examine the risk-taking behavior of the region.

Banks of the GCC region operating in the low power distance, high collectivism, masculine and low uncertainty avoidance cultures are susceptible to assuming more operational and insolvency risks. Furthermore, banks’ overall risk-taking inclination is positively increased once the region has considerable business and monetary freedom.

The governments and bank regulatory bodies may benefit from the study findings by developing the best economic freedom index and national culture that enriches risk management practices and curves excessive risk-taking inclination.

To the best of the authors’ knowledge, this study is the first attempt to address the interplay among culture, economic freedom and bank risk to ensure constructive risk-taking behavior for the GCC banking industry.

The persistent increase in household indebtedness is an alarming issue that is becoming a major concern for economists and governments in developing nations. Although household consumption is an essential source of economic growth, households’ failure to meet their financial obligations will be one of the causes of economic problems if the increase in consumption is largely financed by household borrowing. Therefore, this study aims to analyse the nexus between households’ indebtedness and consumption and the roles of household characteristics.

This study uses a microdata set of the Household Expenditure and Income Survey in 2019, which contained a simple random sampling of 4,730 households.

Using a simultaneous equations model, our results show a negative nexus between households’ consumption and their indebtedness. We find that household savings and size have an indirect impact on the debt service ratio, while the assets and total debt repayment instalments indirectly influence household consumption. We also identify differences in the relationship between the gender of the household head, rural and urban locations and income groups in consumption and indebtedness.

The implication of this study is that governments should adopt several programmes to increase the awareness of household financial and debt management, especially for those in the low-income group.

This study contributes to the empirical literature by establishing a microeconomic perspective of consumption and an indebtedness model focusing on the differences in household characteristics in explaining consumption and indebtedness.

This paper reviews economic and finance research on Islamic investments. In the course of our review, we focus on the following issues: the performance of Islamic stock indexes, Islamic finance–growth nexus and Islamic real-estate investment trust market.

This literature survey consists of two stages such as random and systematic. It begins with a random search of articles with the intention to explore the three different areas of Islamic banking and finance. In order to maintain some level of quality of the literature review, we explored inside citations of articles based on relevant and recent articles from SCOPUS and Web of Science.

This paper represents an attempt to organise current research on Islamic stock markets, Islamic finance-growth nexus and Islamic real-estate finance: (1) the first prevailing finding is that Islamic stock indices are less volatile than conventional stock indices; (2) most empirical studies regarding Islamic finance–growth nexus focus on the impacts of banking sectors on growth and neglect other segments of the Islamic financial market; (3) based on our review of existing studies, there is no unanimous model for Islamic home financing in Islamic banks.

The mixed findings in this area hinder the understanding of Islamic investment and prevent identifying trends that support decision-making. Our review provides suggestions for prospective research directions. Most empirical studies regarding Islamic finance–growth nexus focus on the impacts of banking sectors on growth and neglect other segments of the Islamic financial market.

There is no literature review on Islamic finance-growth nexus and Islamic real-estate literature. Therefore, we are going to fill this gap to review these three different aspects of Islamic banking and finance.

This research aims to investigate the disciplinary functions of depositors and subordinated debt holders within Indonesia's dual banking system, examining the impact of regulatory changes on market discipline.

The study employs a comprehensive analysis of the dual banking system in Indonesia over 15 years. Utilizing a non-public dataset from the Financial Services Authority and the Indonesia Deposit Insurance Corporation, the study employs propensity score matching and difference-in-differences analysis.

The findings reveal distinct patterns in the exercise of market discipline by depositors over different regulatory regimes. During the blanket guarantee regime (2002–2005), depositors lacked the incentive to monitor banks but resumed their disciplinary role under the limited guarantee regime (2005–2017). Islamic banks faced simultaneous market and regulatory discipline, with market discipline prevailing.

This study contributes to the literature by providing novel insights into the interplay between regulatory changes, market discipline and depositor behavior within Indonesia's dual banking system. The utilization of a comprehensive non-public dataset from regulatory authorities adds to the originality of the research.