FINANCE, ECONOMIC FREEDOM, AND FIRM GROWTH: A PANEL EVIDENCE OF SYARIAH COMPLIANCE FIRM IN MALAYSIA

Purpose - This paper examines empirically the role of finance (internal finance and external finance) and economic freedom on growth of syariah compliance firms’ in which listed in Bursa Malaysia for the period of 2000-2010. Design - This study used a static panel data technique namely a fixed effects and random effects model in estimating the determinants of firm’s growth. Then, the sample of syariah compliance firm’s have been split into six sub-sector of economy namely consumer goods, industrial goods, services, construction, real estate and technology. Findings - The empirical results showed that the growth of syariah compliance firm by sub sector of economy is very sensitive influenced by internal fund rather than external fund. Moreover, economic freedom has a negative effect on firms’ growth. Significance - This finding indicated that syariah compliance firms need to consider accordingly the sources of finance and economic freedom in generating their growth.