Leveraging Ethics to Expand Islamic Banks’ Customer Base: a Fuzzy Agent-Based Modeling Approach

Mohamed Wail Aaminou, Rajae Aboulaich


This paper aims to model the dynamics of a banking market featuring two Islamic and one conventional bank. Both Islamic banks opt to differentiate by focusing on Corporate Social Responsibility (CSR) as a lever to attract clients sensitive to ethics. One of them pursues a genuine CSR strategy by investing in serious CSR programs while the other does not honor its CSR engagement by pursuing actions with no or negative societal impact and by taking advantage of information asymmetry. To build the consumers’ decision function, we use fuzzy logic, a diffusion model to capture information spread amongst agents, and learning and contagion models to simulate peers' influence on the decision making process. We run simulations on Netlogo and analyze results. Our findings indicate that while the "rhetoric" bank can thrive in markets characterized by information asymmetry and by clients with heterogeneous attitudes towards ethics, the genuinely engaged bank needs not only to educate consumers about its ethical involvement, but also to heavily leverage communication as a means to increase market share.


Islamic Banks; Multi-Agent Simulation; Fuzzy logic; Ethics; information asymmetry

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