Islamic Economic Values, Community Social Capital, and Women’s Economic Empowerment: The Mediating Role of Community Participation

Abstract

Women’s economic empowerment is increasingly recognized as a critical component of inclusive and sustainable development, yet the mechanisms through which ethical values and community resources translate into economic agency remain insufficiently understood. This study examines the effects of Islamic economic values and community social capital on women’s economic empowerment, with community participation serving as a mediating mechanism. A quantitative cross-sectional design was employed involving 96 women MSME entrepreneurs participating in women’s business communities in a selected regency/city in Indonesia. The results indicate that Islamic economic values and community social capital have significant positive effects on both community participation and women’s economic empowerment. Community participation also exerts a significant positive effect on women’s economic empowerment and partially mediates the relationships between Islamic economic values and empowerment, as well as between community social capital and empowerment. The proposed model explains 68.1% of the variance in women’s economic empowerment, indicating substantial explanatory capacity. These findings demonstrate that women’s empowerment is not determined solely by access to economic resources, but also by the extent to which ethical values and social relationships are translated into meaningful community engagement. The study contributes to women’s entrepreneurship and Islamic economics literature by positioning community participation as a behavioral mechanism linking normative and relational resources to economic empowerment. Practically, the findings highlight the importance of strengthening women’s business communities as platforms for trust-building, peer support, collective learning, and economic decision-making.