Modeling City Image Through Sharia Economic Ecosystems in West Java’s Regional Governments

Abstract

Introduction: Public sector place branding in Muslim-majority developing countries remains under-researched from a theoretical perspective, particularly regarding the mechanisms by which religiosity-based values transform into institutionally recognized city image capabilities. This study examines the relationships between the Religiosity Climate and Religiosity-based Leadership and City Image, and whether Sharia Economic Strategies and Halal Product Support Processes mediate these relationships. The study’s novelty lies in modeling city branding as value cocreation within a religiously oriented public sector service ecosystem. Methods: Using a census of the Regional Development Planning Agencies of all 27 regencies and cities in West Java, Indonesia, with one purposively selected key informant per agency, data were collected through a structured 5-point questionnaire administered from September to December 2023 and analyzed with structural equation modeling–partial least squares (SEM-PLS) using SmartPLS. Results: Religiosity Leadership significantly affected Sharia Economic Strategy, the Halal Product Supporting Process, and City Image, and Religiosity Climate significantly affected Sharia Economic Strategy, the Halal Product Supporting Process, and City Image. The Halal Product Supporting Process was the strongest direct driver of City Image, and both mediators carried significant indirect effects, including a serial pathway from Religiosity Climate through Sharia Economic Strategy and the Halal Product Supporting Process to City Image. Conclusion: Religious values shape the city's image—both directly and indirectly—through operational mechanisms such as a coherent Sharia economic strategy and an effective halal product support system. Consequently, local governments can actively shape a "place brand" grounded in religious values, rather than merely communicating it.

Keywords: city image; halal product supporting process; public-sector marketing; religiosity leadership; service-dominant logic; sharia economic strategy; stakeholder engagement.

Introduction

Cities increasingly compete in a marketing-mediated arena for investment, residents, talent and visitors, and place branding has matured from a communication tool into a relational instrument through which urban identity is co-produced with diverse stakeholders (Källström & Siljeklint, 2024; Swain et al., 2024). Within contemporary marketing thought, City Image is no longer treated as a message broadcast by a city marketing office but as a perceptual outcome that emerges from sustained value cocreation among public institutions, micro-enterprises, citizen-consumers and visitors (Abbasi et al., 2024). This relational view repositions place branding firmly within ServiceDominant Logic (SDL), in which actors integrate operant and operand resources within a service ecosystem to generate experiences that audiences interpret as public value (Eshuis & Ripoll González, 2025; Feng et al., 2023; Giannopoulos et al., 2021). In Muslim-majority emerging economies, religion is not a peripheral cultural variable but a constitutive component of consumer-citizen meaning-making and brand legitimacy

(Al-Ansi & Han, 2019). Indonesia, home to the world's largest Muslim population, has institutionalised this dimension through sharia economics, halal certification regimes and Islamic finance, while pursuing a national agenda to position itself as a global halal hub (Battour et al., 2018; Kurniawan, 2023; Lestari & Widayati, 2022; Syamsurizal et al., 2024). From a marketing standpoint, this institutional infrastructure constitutes a values-based service ecosystem in which religiously grounded norms shape stakeholder expectations, Functional City Identity formation and engagement intensity. Despite the policy salience of sharia economics, three gaps remain unresolved at the intersection of marketing and strategic management. First, public-sector and placemarketing scholarship has predominantly emphasised the demand side how audiences perceive, and form images of, places but has under-theorised the supply-side engagement architecture through which regional governments orchestrate co-creation with stakeholders. Second, although ServiceDominant Logic, value co-creation and stakeholder engagement frameworks have been widely applied in commercial settings, their integration with strategicmanagement constructs in public-sector contexts, particularly under religiously inflected institutional regimes, remains limited. Third, Islamic marketing and halal tourism studies have examined consumer-side perceptions of religiously coded destinations (Al-Ansi & Han, 2019; Battour et al., 2018), yet have rarely connected co-innovation among government, certifiers and MSMEs to the marketing logic of value creation in poverty-prone, emerging-economy regions. The present model integrates four theoretical lenses to address these gaps. Service-Dominant Logic frames City Image as a perceptual outcome co-created within a service ecosystem rather than produced unilaterally by a city authority (Assaker et al., 2014; Fang et al., 2025; Hussain et al., 2023). Value co-creation theory (Amani, 2022; Bal et al., 2023) specifies the resource-integration mechanisms through which government, MSMEs and consumer-citizens jointly produce experiential value. Stakeholder engagement theory (Pasquinelli & Eshuis, 2025), explains how the cognitive, emotional and behavioural investment of multiple actors converts institutional capacity into perceived public value. Four research questions follow. First, do Religiosity Climate and Religiosity Leadership directly shape City Image as a co-created perceptual outcome? Second, do they activate Sharia Economic Strategy and Halal Product Supporting Process as the engagement architecture and service-ecosystem mechanism of the model? Third, do these relational and operational layers translate into City Image? Fourth, is there a significant serial co-creation pathway from

Religiosity Climate through Sharia Economic Strategy and Halal Product Supporting Process to City Image? The contribution is twofold. Theoretically, the paper bridges strategic management and marketing by repositioning a capability-based model of city branding within ServiceDominant Logic, value co-creation and stakeholder engagement theory, thereby reframing, rather than empirically introducing a new construct, a capability-based city-branding model in marketing terms; the theoretically novel element is the serial pathway in which religiosity antecedents reach city image only after being operationalized through Sharia Economic Strategy and the Halal Product Supporting Process in Muslimmajority emerging economies a setting in which religiously inflected service ecosystems shape how citizen-consumers evaluate place brands but which existing place-branding scholarship has largely overlooked. The remainder of the paper is organised as follows. Section 2 reviews the literature on city image, religiously grounded leadership, sharia economic strategy and halal service ecosystems, and develops the hypotheses. Section 3 describes the method. Section 4 presents the measurements, descriptive statistics, reliability and discriminant validity. Section 5 reports the structural results and hypothesis tests. Section 6 discusses the findings and offers conclusions on the religious-based city branding system, including the study’s limitations and directions for future research. Religiosity Climate and Religiosity Leadership Religiosity Climate refers to the shared perception within an institution that religious values inform decisions, norms and routines. From a marketing standpoint, it is theorised as a preengagement value substrate: a meaning-laden context that shapes stakeholder expectations and trust-readiness without itself producing engagement behaviour (Badar et al., 2023; Gürlek, 2022). It conditions the meaning attached to value propositions but does not, on its own, integrate resources or generate co-created outcomes. Religiosity Leadership, by contrast, is an active engagement-enabling role. Drawing on recent work on spiritual and religiously grounded leadership (Lahmar et al., 2023; Qasim et al., 2022), religiously grounded leaders articulate a values-based vision, model integrity and mobilise stakeholders. Read through Service-Dominant Logic, such leaders are operant-resource integrators who convert a values substrate into actionable engagement, orchestrating relationships among regional government, MSMEs, certifiers and citizenconsumers (Alqhaiwi et al., 2023). Theory and prior evidence suggest that a values substrate alone is a weak predictor of relational outcomes when it is not

Figure 1. Conceptual Model of the Religiosity-based city-branding system

translated through engagement-enabling leadership. We therefore expect Religiosity Leadership to dominate Religiosity Climate as an antecedent of relational architecture, service-ecosystem mechanism and perceived public value. This yields: H1: Religiosity Climate has a positive effect on Sharia Economic Strategy. H2: Religiosity Leadership has a positive effect on Sharia Economic Strategy. H3: Religiosity Climate has a positive effect on Halal Product Supporting Process. H4: Religiosity Leadership has a positive effect on Halal Product Supporting Process. H5: Religiosity Climate has a positive direct effect on City Image. H6: Religiosity Leadership has a positive direct effect on City Image.

substrate is translated into a value-based architecture, activated through a service-ecosystem mechanism to yield perceived public value. H10: Sharia Economic Strategy mediates the effect of Religiosity Climate on City Image. H11: Halal Product Supporting Process mediates the effect of Religiosity Leadership on City Image. H12: Sharia Economic Strategy and Halal Product Supporting Process serially mediate the effect of Religiosity Climate on City Image. The integrated framework is depicted in Figure 1, in which Service-Dominant Logic, value co-creation and stakeholder engagement theory operate as the grand-theoretical layer; spiritual leadership and dynamic capability as middle-range theories; and the five-construct path model as the applied marketing layer in a public-sector, Muslim-majority emergingeconomy context.

Sharia Economic Strategy and Halal Product Supporting Process Sharia Economic Strategy refers to the deliberate organisation of regional economic activity around Islamic principles, prohibition of riba, fairness, transparency and social maslahah, translated into local economic planning, sectoral priorities and partnerships (Furqani, 2022; Guizani & Abdalkrim, 2021; Habriyanto et al., 2022). Read through marketing logic, it functions as a relational engagement architecture: it specifies who is included in the value-creation system, how value propositions are structured, and how regulatory, financial and capacity-building resources are coordinated to support MSMEs and consumer-citizens (Judijanto et al., 2023; Kamaruddin & Soemitra, 2022; Kusumaningtyas et al., 2022). Halal Product Supporting Process refers to the operational system through which halal goods and services are certified, monitored and scaled, encompassing coordination among regional governments, certifiers, MSMEs and consumers (Ab Talib et al., 2017; AlAnsi & Han, 2019; Katuk et al., 2021). From an SDL perspective, it constitutes the service-ecosystem co-creation mechanism through which intended value propositions become enacted experiences that consumer-citizens evaluate (Darmalaksana, 2023; Ikhwan, 2024; Karyani et al., 2021; Kasri et al., 2021). Treated jointly, the two variables form the relational and operational layers through which religiously inflected value is co-created (Alemayehu et al., 2023; Azizah et al., 2023; Muttaqien & Dewi, 2024; Usman et al., 2023). Consistent with marketing-strategy logic and dynamic capability arguments, an engagement architecture without an operational ecosystem fails to scale, while an operational ecosystem without a coherent engagement architecture drifts. We therefore model Sharia Economic Strategy as an antecedent of Halal Product Supporting Process, and both as antecedents of City Image: H7: Sharia Economic Strategy has a positive effect on Halal Product Supporting Process. H8: Sharia Economic Strategy has a positive direct effect on City Image. H9: Halal Product Supporting Process has a positive direct effect on City Image.

Methods

This study employs a quantitative survey approach to examine the determinants of city image in the context of sharia economic development across West Java Province. The unit of analysis is the Bappeda of each regency and city, treated as the institutional informant most directly responsible for formulating and coordinating sharia-economy policy and halal-product supporting processes at the regional level. Data were Table 1. A priori power analysis and achieved power (α = 0.05, four predictors; N = 27) Effect size

collected through structured questionnaires using a 5-point interval scale, distributed during September–December 2023. Two. sampling decisions operate at different levels and should be distinguished. At the institutional level, the study is a complete census: all 27 Bappeda of West Java's 18 regencies and 9 cities were included, so the entire institutional population was covered rather than sampled. At the individual level, the single key informant within each agency was selected purposively, on the basis of role-based knowledge of sharia-economy and halal-product policy. The agency selection was therefore a census, not purposive sampling; only the choice of informant within each agency was purposive. Table 2 shows the distribution of respondents For each Bappeda, the key informant was the head of the division responsible for economic affairs and regional development planning, or the officially designated sharia-economy focal point the individual with the most complete oversight of sharia-economy and halal-product policy at the regional level. Each informant had held this post for more than one year, providing sufficient tenure and direct oversight to report reliably on their agency's sharia-economy and halal-product policy. The unit of analysis is Bappeda, whereas the unit of observation is the single key informant who reports on that institution's behalf. response rate. To limit common-method bias, informants were assured of confidentiality and that no answers were right or wrong, and items measuring different constructs were interspersed rather than grouped by construct within the instrument. The sample is small in absolute terms. PLS-SEM was chosen because it is predictionoriented and appropriate for exploratory, multi-mediator models (Hair et al., 2019); it does not, however, overcome the constraints of a small sample. To evaluate statistical power given the small sample, an a priori power analysis was conducted in G*Power 3.1 for a linear multiple-regression model (F² test of the increment in R²), following the maximum-predictor rule for PLS-SEM path models. The most complex endogenous construct, City Image, receives four predictors (Religiosity Climate, Religiosity

Leadership, Sharia Economic Strategy, and the Halal Product Supporting Process); the analysis therefore used four predictors, α = 0.05 and power (1 − β) = 0.80. Under these parameters, detecting a large effect (f² = 0.35) requires a minimum of 40 observations, a medium effect (f² = 0.15) requires 85, and a small effect (f² = 0.02) requires 599 (Faul et al., 2009) (see Table 1). A complementary sensitivity analysis indicated that, at N = 27 with four predictors, the design attains 80% power for effects of f² ≈ 0.44 or larger, that is, large effects only. Three considerations qualify this constraint. First, the data constitute a complete census of all 27 Bappeda in West Java rather than a probability sample, so the entire target population is observed and no inference to an unobserved population is required. Second, the observed standardized path coefficients are large (β = 0.245–0.421) and all twelve hypothesised paths were significant at p < 0.05, indicating that the population effects were strong enough to be detected at this sample size. Third, PLS-SEM is a prediction-oriented method appropriate for exploratory, multi-mediator models (Becker et al., 2023); this supports exploratory use of the model but does not by itself remedy the limited statistical power documented above. Accordingly, the reported effects should be interpreted with caution: at N = 27 the design attains 80% power only for very large effects (f² ≈ 0.44), with an estimated power of about 0.58 at the conventional large-effect benchmark (f² = 0.35) and only 0.27 for medium effects. The data were analyzed using SEM-PLS with SmartPLS version 3.3.3 across three testing stages: the outer model test, inner model test, and hypothesis test. The operationalization of variables and indicators of the latent constructs is summarized in Table 3, adapted from prior studies relevant to sharia-based development and place branding. Religiosity Climate (RC) was measured with 9 items across three dimensions: religious values, the social environment and MSME community, and leadership in MSME policy. Religiosity Leadership (RL) was measured with 6 items across two dimensions: religious leadership in MSME policy and religiosity values. Sharia Economic Strategy (SES) was measured with 12 items across four dimensions: sharia regulation and policy, sharia financing and financial support, sharia socialization and market access, and sharia capacity and ecosystem development. Halal Product Supporting Process (HPSP) was measured with 12 items across four dimensions: program sustainability and feasibility, economic impact and benefit, implementation challenges and ease, and quality of support and facilitation. City Image (CI) was measured with 6 items across two dimensions: realization of sharia city identity and sharia business environment outcomes. All five constructs were modelled reflectively on constructtheoretic grounds rather than on software convention alone. Religiosity Climate and Religiosity Leadership are treated as latent dispositions whose items are interchangeable manifestations of, respectively, a shared religious value orientation and a religiously grounded leadership disposition: dropping any single item would not change the meaning of the construct, and the items are expected to covary because they share a common cause. Consistent with this reflective specification, the measurement model was therefore evaluated through indicator loadings, internal-consistency reliability, convergent validity (AVE) and discriminant validity (Becker et al., 2023; Chin, 1998; Sarstedt & Danks, 2022; Sarstedt, Ringle, & Hair, 2022). In the outer-model evaluation, all indicators exhibited outer loadings above the 0.70 threshold (Hair et al., 2016) in a single estimation run, so no indicators were eliminated.

Result and Discussion

Result and Discussion

Table 4 presents the institutional profile of the 27 regional government agencies participating in this study, covering all

regencies and cities of West Java Province. The participating agencies are the Bappeda of each regency and city — the institutions responsible for coordinating cross-sectoral regional development planning, including the cooperatives, micro, small, and medium enterprise (MSME), trade, and industry agenda. The sample comprises 18 regencies and 9 cities, and although institutional nomenclature varies across regions, the substantive mandate empowering local businesses, strengthening the local economy, coaching business actors, and enhancing regional competitiveness is broadly comparable. Service coverage differs between regencies, which span wider sub-district and village areas and thus require more complex coordination, and cities, which have smaller administrative areas but more concentrated economic activity. Programs increasingly incorporate a sharia dimension halal certification and self-declaration, sharia financial literacy, sharia incubation, and sharia KUR delivered in collaboration with partners such as Bank Indonesia, OJK, the Ministry of Religious Affairs, universities, the Sharia Economic Society (MES), and Bank BJB. Respondents are mostly senior officials, predominantly male, mostly aged 41–51 and 52– 60, holding master's degrees, and with long tenures of 15 years or more indicating that the data were obtained from experienced actors familiar with regional policy and program

implementation. Table 5 shows the result of the convergent validity test with loading factor parameters. The result demonstrates that all indicators of the latent variable are > 0.7, which shows a strong relation between the measurement variable and its factor, making the test valid. Table 6 illustrates the evaluation of convergent validity using the average variance extracted (AVE) parameter. The findings reveal that all latent variables are greater than 0.5, indicating that the indicators within each construct consistently and accurately measure the respective construct. Table 7 shows the result of the discriminant validity test with cross-loading parameters, demonstrating that the correlation value between items with each latent variable is greater than the item correlation of a latent variable with other variables. It can be concluded that the result met the discriminant validity testing requirements (Hair et al., 2019). Table 8 shows the Fornell-Larcker discriminant validity test. The results suggest that a construct has excellent validity if its AVE value is more extensive than its quadratic correlation with other constructs in the model (Hair et al., 2019). Table 9 shows the reliability test results with Cronbach’s Alpha and composite reliability parameters. The findings indicate that all parameter values are greater than 0.70,

General Description 27 regencies and cities 18 regencies and 9 cities Regional Development Planning Agencies (Bappeda) coordinating the cooperatives, MSME, trade, and industry agenda Regional Development Planning Agencies (Bappeda) MSME empowerment, micro-enterprise strengthening, business facilitation, trade, and industry Strengthening the capacity of business actors Coaching of micro-scale businesses Administrative and program support for businesses Developing entrepreneurial spirit and capacity Strengthening cooperation networks Digital-based service delivery and business development Broader area coverage; more complex coordination needs More limited coverage; more concentrated services Many agencies coordinate with the provincial government Service strategies adapted to each area's characteristics Facilitation of product legality Assistance with simplified certification Education on financing and financial management Business coaching within the sharia ecosystem Strengthening access to business financing Training, mentoring, and capacity strengthening Coaching support and program strengthening Financial literacy and financing access Support for halal and sharia economy programs Mentoring, training, and academic support Strengthening the sharia economic ecosystem Regional financial access support Dominated by Heads of Division and Heads of Office Majority male Predominantly 41–51 and 52–60 years Majority hold a master's degree (S2) Predominantly 15–19, 20–24, and 25+ years

proving that the measuring tool used in this study is reliable (Hair et al., 2016). Table 10 shows the result of the inner model test with the R-square parameter, demonstrating three R-square values, namely Sharia Economic Strategy (0.682), Halal Product Supporting Process (0.748), and City Image (0.812), with corresponding adjusted R-square values of 0.656, 0.717, and 0.787, respectively. Based on these findings, it can be inferred that the structural model in this study falls within the moderate-to-strong category. An R-square value is considered substantial if it is greater than 0.67 and moderate if it is greater than 0.33 (Chin, 1998). Table 11 presents the results of the direct hypothesis tests, and Table 12 reports the indirect (mediation) effects. All twelve hypotheses are supported, as their p-values are below 0.05. The nine direct paths (H1–H9) are positive and significant, confirming that Religiosity Climate and Religiosity Leadership shape Sharia Economic Strategy and the Halal Product Supporting Process, and that these two constructs,

together with both religiosity-based antecedents, significantly influence City Image. The Halal Product Supporting Process is the strongest direct driver of City Image (β = 0.421). The three mediation hypotheses (H10–H12) are also supported, indicating that Sharia Economic Strategy and the Halal Product Supporting Process transmit the effects of the religiosity-based antecedents to City Image, including the serial pathway from Religiosity Climate through Sharia Economic Strategy and the Halal Product Supporting Process to City Image. Following Zhao, Lynch, and Chen (2010), each of the three mediations is classified as complementary (partial) mediation: the indirect effect and the corresponding direct effect — Religiosity Climate → City Image for H10 and H12, and Religiosity Leadership → City Image for H11 — are both positive and significant and act in the same direction. Religiosity Climate and Sharia Economic Strategy As previously stated, the findings indicate a positive and

Dimension Religious Values

RC

Social Environment & MSME Community Leadership in MSME Policy Religious Leadership in MSME Policy

RL Religiosity Values Sharia Regulation & Policy Sharia Financing & Financial Support SES Sharia Socialization & Market Access Sharia Capacity & Ecosystem Development Program Sustainability & Feasibility Economic Impact & Benefit HPSP Implementation Challenges & Ease Quality of Support & Facilitation Realization of Sharia City Identity CI

Sharia Business Environment Outcomes

Item NA1 NA2 NA3 LSKU1 LSKU2 LSKU3 KKU1 KKU2 KKU3 KKU_KR1 KKU_KR2 KKU_KR3 NR1 NR2 NR3 RKS1 RKS2 RKS3 DPKS1 DPKS2 DPKS3 SAPS1 SAPS2 SAPS3 PKES1 PKES2 PKES3 KKP1 KKP2 KKP3 DME1 DME2 DME3 TKI1 TKI2 TKI3 KDF1 KDF2 KDF3 RIKS1 RIKS2 RIKS3 HLBS1 HLBS2 HLBS3

Outer Loading (λ) 0.938 0.829 0.820 0.892 0.848 0.861 0.878 0.841 0.794 0.917 0.850 0.907 0.888 0.812 0.890 0.873 0.789 0.896 0.879 0.905 0.867 0.902 0.823 0.891 0.886 0.859 0.731 0.855 0.824 0.939 0.908 0.846 0.852 0.881 0.777 0.846 0.838 0.857 0.792 0.959 0.924 0.922 0.937 0.932 0.880

Decision Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained Retained

significant effect of religiosity climate on sharia economic strategy across regencies and cities in West Java. A regional government environment infused with religiosity values shared rituals, ethical norms, and adherence to sharia principles encourages policymakers and operational staff to embed Islamic economic logic into regional planning. This climate provides the moral and cognitive frame within which adaptive sharia economic strategies covering halal-MSME empowerment, sharia financial inclusion, sharia tourism, and sharia investment promotion are formulated and prioritized. From a dynamic capability perspective, religiosity climate behaves as a sensing-and-shaping resource: it sensitizes the organization to sharia-relevant opportunities and legitimizes the strategic moves needed to exploit them. The result confirms that the climate-strategy linkage is not merely cultural rhetoric but a measurable mechanism through which intangible religiosity assets are converted into deliberate strategic action. Religiosity Climate and Halal Product Supporting Process The results show that religiosity climate exerts a positive and significant influence on the halal product supporting process across regencies and cities in West Java. A strong religiosity climate within local government institutions cultivates shared values, norms, and practices that emphasize integrity, accountability, and adherence to sharia principles. These values translate into operational support for halal certification, supervision of MSMEs, and the readiness of halal supporting facilities such as halal logistics, halalcertified slaughterhouses, and halal product information systems. Religiosity Leadership and Sharia Economic Strategy The findings reveal that religiosity leadership has a positive and significant effect on the formulation and execution of sharia economic strategy. Leaders who embody religiosity values such as honesty, justice, responsibility, and exemplary conduct are more likely to embed sharia principles into regional economic policy. This includes prioritizing halalfriendly investment, sharia-based MSME empowerment, sharia financial inclusion, and the establishment of halal industrial clusters. Religiosity leadership also strengthens stakeholder engagement by mobilizing ulama, MUI, BPJPH, sharia financial institutions, and academia into a coherent sharia economic ecosystem. The strategic articulation of these elements is essential for translating religiosity values into measurable economic outcomes that contribute to building the city image of regencies and cities in West Java. Religiosity Leadership and the Halal Product Supporting Process The results also confirm that Religiosity Leadership significantly strengthens the Halal Product Supporting Process (β = 0.327). Leaders who model religiosity values do not merely set strategic direction; they mobilise the operational coalition certifiers (BPJPH, MUI), sharia financial institutions, MSME agencies and logistics providers whose coordination is required for halal certification, supervision and supply-chain readiness to function. Read through ServiceDominant Logic, religiosity leadership acts as the operantresource integrator that converts a values orientation into an actual service-ecosystem capability, which explains why leadership registers on the operational layer and not only on the strategic one. Sharia Economic Strategy, the Halal Product Supporting Process and City Image Within the operational core of the model, Sharia Economic Strategy significantly drives the Halal Product Supporting Process (β = 0.389), and both translate into City Image

Sharia Economic Strategy directly (β = 0.358) and, most strongly, the Halal Product Supporting Process (β = 0.421, the largest direct effect in the model). This ordering is theoretically informative. A coherent sharia economic strategy specifies the value propositions and resource commitments, but it is the halal product supporting process visible certification, functioning halal supply chains and credible auditing that citizenTable 6. Average Variance Extracted Variable Religiosity Climate (RC) Religiosity Leadership (RL) Sharia Economic Strategy (SES) Halal Product Supporting Process (HPSP) City Image (CI)

Average Variance Extracted (AVE) 0.734 0.771 0.739 0.726 0.795

CI 0.724 0.653 0.547 0.690 0.749 0.705 0.765 0.649 0.669 0.889 0.775 0.922 0.836 0.810 0.896 0.836 0.692 0.836 0.880 0.828 0.752 0.794 0.832 0.715 0.770 0.688 0.524 0.738 0.781 0.851 0.783 0.765 0.686 0.840 0.758 0.827 0.698 0.752 0.666 0.959 0.924 0.922 0.937 0.932 0.880

HPSP 0.760 0.570 0.654 0.653 0.681 0.677 0.722 0.720 0.606 0.815 0.509 0.822 0.763 0.656 0.800 0.860 0.715 0.814 0.823 0.842 0.800 0.876 0.815 0.832 0.777 0.682 0.668 0.855 0.824 0.939 0.908 0.846 0.852 0.881 0.777 0.846 0.838 0.857 0.792 0.862 0.820 0.849 0.920 0.883 0.853

RC 0.938 0.829 0.820 0.892 0.848 0.861 0.878 0.841 0.794 0.745 0.645 0.695 0.811 0.625 0.786 0.645 0.564 0.786 0.706 0.764 0.575 0.779 0.574 0.640 0.716 0.636 0.623 0.743 0.499 0.823 0.746 0.664 0.670 0.744 0.667 0.663 0.562 0.571 0.632 0.782 0.757 0.722 0.706 0.667 0.611

RL 0.726 0.703 0.533 0.707 0.798 0.746 0.771 0.637 0.680 0.917 0.850 0.907 0.888 0.812 0.890 0.783 0.640 0.830 0.890 0.769 0.705 0.743 0.755 0.666 0.736 0.664 0.495 0.735 0.717 0.791 0.697 0.683 0.655 0.803 0.747 0.764 0.621 0.701 0.621 0.904 0.881 0.846 0.894 0.866 0.792

SES 0.763 0.558 0.631 0.651 0.634 0.662 0.762 0.719 0.593 0.781 0.574 0.875 0.719 0.696 0.797 0.873 0.789 0.896 0.879 0.905 0.867 0.902 0.823 0.891 0.886 0.859 0.731 0.762 0.809 0.857 0.813 0.800 0.770 0.813 0.719 0.807 0.842 0.741 0.722 0.871 0.802 0.834 0.892 0.896 0.810

consumers, investors and visitors are expected to encounter and evaluate; because only government officials were surveyed, this evaluation is inferred by institutional informants rather than measured directly among those external stakeholders. Direct Effects of Religiosity Climate and Religiosity Leadership on City Image Finally, both religiosity antecedents exert significant direct effects on City Image Religiosity Leadership (β = 0.276, p = 0.005) and Religiosity Climate (β = 0.245, p = 0.009). The significant direct effect of Religiosity Climate is notable, because a pure mediation logic would predict that a diffuse value substrate reaches City Image only through strategy and process. Its direct significance suggests that a visibly religious institutional environment carries independent signalling value: stakeholders read the religiosity climate of a regional government as a marker of authenticity and trustworthinessthat shapes the perceived image of the city even before strategic and operational outcomes fully materialise. That Religiosity Leadership shows the larger direct coefficient is consistent with the study’s broader argument that engagement-enabling leadership is the more actionable lever; however, the two effects are close in magnitude, and the significance of the climate path indicates that leadership complements rather than substitutes for a supportive religiosity climate. Mediating Role of Sharia Economic Strategy and Halal Product Supporting Process on City Image This study demonstrates that sharia economic strategy and halal product supporting process play significant mediating roles between religiosity climate, religiosity leadership, and city image. Religiosity climate and religiosity leadership influence city image both directly and indirectly; the strategy and the supporting process are the operational vehicles that carry this indirect influence. The mediation tests reported in Table 12 support three specific indirect pathways: Sharia Economic Strategy mediates the effect of Religiosity Climate on city image (H10), and the Halal Product Supporting Process mediates the effect of Religiosity Leadership on city image (H11). The single serial pathway that was tested (H12) runs from Religiosity Climate through Sharia Economic Strategy and the Halal Product Supporting Process to City Image; the discussion is therefore confined to this tested path. No serial pathway originating in Religiosity Leadership was estimated, and the reported indirect effects do not by themselves establish full parallel mediation of both

antecedents an extension left to future research. These mediation findings extend dynamic capability theory in a public-sector context: regional governments build city image not by relying solely on intangible religiosity assets but by progressively converting them into adaptive sharia economic strategies and into a halal supporting infrastructure that is observable to stakeholders, investors, and the wider public. These findings indicate that intangible cultural assets such as religiosity gain economic and reputational value primarily when they are operationalized through a coherent halal ecosystem. The findings further highlight that halal product supporting process is the most proximate driver of city image, while sharia economic strategy provides the longer-term institutional Table 8. Fornell-Larcker CI HPS P RC RL SES

CI 0.892 0.812

HPSP 0.852

0.704 0.731 0.789

0.728 0.755 0.806

RC

RL

SES

0.857 0.687 0.722

0.878 0.748

0.860

Cronbach's Alpha

Composite Reliability

0.954

0.961

0.940

0.953

0.968

0.971

0.965

0.970

0.976

0.979

R-Square

R-Square Adjusted

0.682

0.656

0.748

0.717

0.812

0.787

Religiosity Climate (RC) Religiosity Leadership (RL) Sharia Economic Strategy (SES) Halal Product Supporting Process (HPSP) City Image (CI) Table 10. R-Square Variable Sharia Economic Strategy (SES) Halal Product Supporting Process (HPSP) City Image (CI)

Path RC → SES RL → SES RC → HPSP RL → HPSP RC → CI RL → CI SES → HPSP SES → CI HPSP → CI

β (t; p) 0.412 (4.218; 0.000) 0.456 (4.673; 0.000) 0.298 (3.142; 0.002) 0.327 (3.421; 0.001) 0.245 (2.612; 0.009) 0.276 (2.834; 0.005) 0.389 (3.876; 0.000) 0.358 (3.654; 0.000) 0.421 (4.387; 0.000)

Result Supported Supported Supported Supported Supported Supported Supported Supported Supported

Path RC → SES → CI RL → HPSP → CI RC → SES → HPSP → CI

β (t; p) 0.148 (2.984; 0.003) 0.138 (2.756; 0.006) 0.067 (2.214; 0.027)

Result Supported Supported Supported

architecture. Cities and regencies that have advanced halal certification coverage, halal-tourism readiness, and wellcoordinated halal value chains are assessed by their government officials as more authentic sharia-aligned regions, pending confirmation from external stakeholders. This perception may, in turn, help attract halal investment, sharia tourism, and sharia-based talent, potentially reinforcing a virtuous cycle that consolidates the sharia economic identity of West Java as a national reference for halal ecosystem development.

Conclusion

Theoretically, this study contributes by integrating dynamic capability theory with city-image and Islamic economics literature, demonstrating that religiosity climate and religiosity leadership function as intangible regional capabilities that must be operationalized through sharia economic strategy and halal product supporting process to materialize as a strong, institutionally perceived city-image capability. The empirical confirmation of both parallel and serial mediation enriches the existing literature, which has predominantly examined religiosity-based constructs in firm-level rather than regionalgovernment contexts. Practically, this research provides regional governments in West Java with an actionable model: strengthen religiosity climate through institutional habituation; develop religiosity leadership through capacity-building of regional leaders; design adaptive sharia economic strategies that respond to halal-market dynamics; and accelerate halal product supporting processes through inter-agency coordination among Bappeda, BPJPH, MUI, sharia financial institutions, and MSME ecosystems. This study has several limitations that also define directions for future research. First, the design is cross-sectional, capturing the relationships among Religiosity Climate, Religiosity Leadership, Sharia Economic Strategy, the Halal Product Supporting Process and City Image at a single point in time; it therefore establishes association rather than temporal causality. Longitudinal or panel designs would allow future studies to test how the co-creation pathway unfolds and stabilises as regional halal ecosystems mature. Second, the data were drawn from a single institutional informant per Bappeda and from the supply side of the cocreation system. External stakeholder data — from citizens, visitors, investors and MSMEs — were not collected; the City

Image construct therefore captures an institutionally perceived city-image capability reported by government officials, and the study cannot establish actual public city image. Although these informants are the actors most directly responsible for shariaeconomy policy, future research should incorporate multiple informants per institution and triangulate the government perspective with demand-side data from citizen-consumers, MSMEs and visitors, thereby testing the full co-creation loop rather than its supply side alone. Third, although N = 27 is a complete institutional census of the Bappeda agencies across West Java's regencies and cities (with one purposively selected key informant per agency) a strength for internal validity it constrains generalisation to other provinces and to other Muslimmajority economies, and limits the statistical power available to detect very small effects or higher-order moderation. Fourth, the constructs rely on self-reported perceptual measures; future work could complement them with objective indicators such as halal-certification coverage, sharia-financing volumes and realised halal investment. Finally, the strategicmanagement constructs were modelled reflectively; reconceptualising the strategy and process constructs formatively, and introducing contextual moderators such as fiscal capacity or digital-infrastructure readiness, offers a promising extension of the religiously grounded city-branding model proposed here.

Author Contributions

Authors explicitly outline and describe their individual contributions to the research and the development of the manuscript. This statement is intended to provide transparency and clarity regarding each author's role in the project. It helps readers and reviewers understand the specific contributions of each author to the research process.

Acknowledgements

Brief expression of gratitude to individuals, organizations, or institutions that have played a supportive role in the research or publication process but do not meet the criteria for authorship. Includes thanks for financial support, technical guidance, data collection assistance, access to facilities or equipment, mentorship, and other forms of help.

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