THE DUALISTIC ROLE OF RELIGIOUS CULTURAL CAPITAL IN THE DEVELOPMENT OF INDONESIA’S ISLAMIC ECONOMY

Abstrak

This study aims to develop a dualistic conceptual model regarding the role of cultural-religious capital in Indonesia’s economic development by bridging the gap in literature that has not yet provided a comprehensive framework. Using a qualitative literature synthesis approach adapted to the Culture-Based Development (CBD) framework, this study analyzes how culture operates through two mechanisms: formation mechanisms shaping human capital quality and interaction mechanisms improving economic collaboration efficiency. The findings show that cultural-religious capital plays a dual role. Constructively, social capital reduces transaction costs and strengthens collective collaboration, while entrepreneurial ethos shapes resilient and innovative human capital. Destructively, rigid traditionalism and communal exclusivism hinder innovation, reduce modern competency adoption, and distort resource allocation. The study concludes that sustainable economic development requires culturally sensitive policies that maximize constructive potentials while mitigating destructive risks.