Impact of Demographic and Socioeconomic Profile on Libyan Firms’ Attitudes Towards Islamic Methods of Finance

Libyan Firms’ Attitudes Towards Islamic Methods of Finance

Abstract

This paper investigates the impact of demographic and socioeconomic
profiles on Libyan business firms’ attitudes towards potential use of Islamic
methods of finance. A sample of 296 firms is surveyed using phone interviews
during December 2007 and January 2008 to gather information on their
demographic and socioeconomic profiles as well as their attitudes towards
Islamic methods of finance. Descriptive statistics is used to indicate the main
characteristics of the sample and potential use of Islamic methods of finance.
The results indicate that over two-third (72.3 %) of Libyan firms are
potential users of Islamic methods of finance. Discriminant analysis is used
to indicate which of these profiles has significant impact on the attitudes of
Libyan business firms towards Islamic methods of finance. This analysis
illustrates that share capital, total assets, business experience and number of
partners is the most important factors in discriminating between the two
groups of business firms (potential users and non-potential users of Islamic
methods of finance).