Emerging middles: Class, development and the halal economy in Indonesia and Malaysia

Fischer, Johan; Nisa, Eva F. Article Emerging middles: Class, development and the halal economy in Indonesia and Malaysia Research in Globalization Provided in Cooperation with: Elsevier Suggested Citation: Fischer, Johan; Nisa, Eva F. (2025) : Emerging middles: Class, development and the halal economy in Indonesia and Malaysia, Research in Globalization, ISSN 2590-051X, Elsevier, Amsterdam, Vol. 10, pp. 1-10, https://doi.org/10.1016/j.resglo.2025.100276 This Version is available at: https://hdl.handle.net/10419/331199 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes. You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public. If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by-nc/4.0/ Emerging middles: Class, development and the halal economy in Indonesia and Malaysia ☆ Johan Fischer a,* , Eva F. Nisa b a Dept. of Social Sciences and Business, Roskilde University, Universitetsvej 1, 14.2, 4000 Roskilde, Denmark b Anthropology, School of Culture, History and Language, The Australian National University, ACT 0200, Australia ARTICLE INFO Keywords: Indonesia Malaysia Global development Middle class State Market Halal ABSTRACT The rise of the middle classes in the Global South plays a key role in global development arguments characterized by “converging divergence,” where there are decreasing inequalities between countries and increasing inequalities within countries. The concept of the middle class in the social sciences helps explain the origins of the modern world, with the middle class occupying a mythical place in the advent of development and modernity. Critiques of global development with respect to the middle class focus on the analytical meaning of “middle” and “class”, and the broader issue of insufficient attention to the history and context of the middle class. These issues are often most hotly debated in connection with the middle classes in middle-income countries (“emerging middles”) that may be caught in a middle-income trap. Based on a historical and ethnographic analysis of Indonesia and Malaysia as “emerging middles,” this paper argues that a qualitative and comparative approach to a lifestyle analysis of middle-class transformation strengthens understanding of global development. The central research question concerns how the state and market in Indonesia and Malaysia have shaped Muslim middleclass lifestyles. Our methodology is inspired by a “middle position”, involving combining historical/ethnographic analysis with insights from global development when discussing the “middles”, that is, middle-class groups in middle-income countries. 1. Introduction Arguments for global development characterized by “converging divergence”, that is, the decreasing inequalities between countries and increasing inequalities within countries, hinge on a growing middle class in middle-income countries (Horner & Hulme, 2019: 372). Specifically, scholars argue that we must move beyond (the rhetoric of) international development (poverty, the “Third World”, the relations between developed and developing countries, the Global North–South divide, Western aid, as well as (post)colonialism) towards a more holistic global development that arguably pertains to increasingly interconnected globalized capitalism, sustainable development challenges, and the blurring of conventional North–South boundaries (Horner, 2020). The status of the Global South within this international context has transformed, presenting significant opportunities for the Global South to assume a more influential role in determining the future of the global community. The concept of global development does not suggest that nations are insignificant. On the contrary, national trajectories inform and detail global development, as we shall see it in the case of Indonesia and Malaysia. Principles of global development and world order such as equality, democracy, cosmopolitanism, and peace are embedded in the historical movement towards ‘global convergence’ between Global North–Global South and global urban spheres–global rural spheres (Gills, 2017). Global development has become a buzz phrase that argues for the redrawing of the map of development and globalization in the twentyfirst century: global convergence, the “rise of the South” and the emergence of global studies make development holistic, universal, sustainable and interconnected. We take our cue from these points when analysing the “emerging middles”, middle-class groups in middleincome countries, of Indonesia and Malaysia. These countries are hailed as proponents of the Tiger Cub economies of Southeast Asia. The term Tiger Cub economies refer to a group of five emerging economies in Southeast Asia: Indonesia, Malaysia, the Philippines, Thailand and Vietnam. This label suggests that these countries are adopting a development model similar to that of the high-growth economies of the Four ☆ This article is part of a special issue entitled: ‘Global Development’ published in Research in Globalization. * Corresponding author. E-mail addresses: [email protected] (J. Fischer), [email protected] (E.F. Nisa). Contents lists available at ScienceDirect Research in Globalization journal homepage: www.sciencedirect.com/journal/research-in-globalization https://doi.org/10.1016/j.resglo.2025.100276 Received 30 August 2024; Received in revised form 16 February 2025; Accepted 18 February 2025 Research in Globalization 10 (2025) 100276 Available online 20 February 2025 2590-051X/© 2025 The Author(s). Published by Elsevier Ltd. This is an open access article under the CC BY-NC license ( http://creativecommons.org/licenses/bync/4.0/ ). Asian Tigers (Hong Kong, Singapore, South Korea and Taiwan). Key to our class analysis is the way in which the state and markets in both Indonesia and Malaysia—two key nations in the Muslim Archipelago, home to about 275 million Muslims—are actively giving shape to a Muslim middle class that is seen to signify development in a globalizing world. However, in order to understand these processes, we need to place them within a broader historical and empirical context. By providing a thorough and comparative analysis, we aim to address gaps in global development discourse, demonstrating the significance of lifestyles in shaping social classes in Indonesia and Malaysia. Weber (1978) theory of social stratification emphasizes the role of lifestyles in class structures, consumption and the social inclusion or exclusion of groups. Similarly, our approach provides a useful lens through which to understand the interconnection between social structures and individual actions. We argue that adopting a qualitative and comparative approach to a lifestyle analysis of middle-class transformation strengthens global development thinking. The central research question concerns how the state and markets in Indonesia and Malaysia have shaped middle-class lifestyles, particularly within the context of the Islamic economy and the halal (an Arabic word that literally means “permissible” or “lawful”) industry. Our methodology is grounded in a “middle position”, which involves combining historical and ethnographic analysis with insights from global development when discussing the “middles”. A key observation within our analysis is that Muslim middle-class individuals and groups in Indonesia and Malaysia often self-identify as a distinct class, despite the ambiguity surrounding the exact definition of what constitutes the middle class. In Indonesia, this class is referred to as kelas menengah, while in Malaysia, it is termed kelas pertengahan. We compare Indonesia and Malaysia because these countries are quintessential examples of “emerging middles,” despite their economic growth occurring at different times. Malaysia achieved upper-middleincome status in 1996, whereas Indonesia reached this classification more recently in 2019. Both economies have experienced steady growth, with notable exceptions being the Asian financial crisis of 1997/1998 and the pandemic period. Moving from the “Third World” to the “Global South”; they embody a mix of ethnic government support for the Muslim middle class within the context of open and globalized economies, which together shape middle-class lifestyles. We base our analysis on more than two decades of historical and ethnographic research on the middle class in Indonesia and Malaysia. Our class analysis is informed by an everyday political economy approach to urban Muslim Southeast Asia that explores economic transformations among ordinary people as well as marketized/rationalized economic policy making conditioned by everyday practices of economic engagement (Elias & Rethel, 2016). A comparative case study approach is particularly well suited to social research on “emerging middles”, as it places middle-class culture, context and comparison at its core while also considering the middleincome trap as a multi-scalar phenomenon. The middle-income trap operates at multiple levels: nationally (distinguishing middle-income from high-income countries), locally (highlighting disparities between core and less prosperous regions), and individually (contrasting wealthier households with those facing economic constraints) (Andriesse, 2025). This multi-scalar and comparative perspective inform our approach, as discussions on the middle-income trap have often remained broad, leaving significant gaps in understanding its specific implications and manifestations in Southeast Asia. Rather than viewing the middleincome trap solely as a national economic transition issue (see Gill & Kharas, 2007), we examine how it unfolds at local and personal levels. This perspective enables us to explore how economic growth is unevenly distributed across regions and social groups, shaping class transformation in diverse and complex ways. Since the 1980s, Muslim Southeast Asia has played a key role in shaping a global Islamic economy, leading to the development of distinct Muslim ethics and lifestyles in relation to consumption and marketization. Various Muslim groups, particularly the revivalists that have been central to the redefinition of Muslim middle-class lifestyles since the 1970s, have redefined the concepts of “economy” and “development” from the individual to global levels. Their interactions with the economy have resulted in transformations of Islamic identities. This phenomenon is particularly evident in Muslim Southeast Asia, yet there has been little comprehensive exploration of the concept of Muslim piety as economy (Fischer & Jammes, 2020) in the context of class formation and global development. Specifically, halal is key to understanding middle-class lifestyles in Muslim Southeast Asia and the interactions between state and market, most notably in Indonesia and Malaysia. Halal markets shape – and are themselves shaped by – Islamic middle-class lifestyles. The halal industry market in Indonesia is forecast to account for 19.1 % of GDP in 2030 (USD billion 311.7) and the corresponding figure for Malaysia is 11 %, USD billion 58.5) (YCP Solidiance, 2024a, 2024b). With a focus on Indonesia and Malaysia as sites of significant and diverse integration of Islam and the economy, the production of Muslim middle-class lifestyles has emerged (Nisa, 2023a, 2023b). Importantly, Indonesia and Malaysia have driven the creation of a global Muslim piety as an economy, with middle-class Muslims playing roles as producers, regulators and consumers. This article explores the relationship between Islam and the economy in Muslim Southeast Asia, with a specific focus on the “emerging middles”. Following this introduction, we will focus on broader perspectives of (in)equality and the middle-income trap as multi-scalar phenomena before exploring class and (global) development, including a review of the class and development literature and our perspective on class analysis. An important question here is how to address the imprecision of the concept of “emerging middles”. Then we contextualize the middle class in Indonesia and Malaysia before exploring middle-class lifestyles, with specific reference to the state and market. The concluding discussion ties the findings together and suggests that global development thinking can be strengthened by considering a contextualized class analysis. 2. (In)equality, middle-income traps and broader perspectives Contemporary development narratives and not least global development often celebrate the rise of the middle classes in the Global South. Amid persistent poverty, policymakers find encouragement in these success stories characterized by self-sufficiency, the capacity to engage with the global economy, purchasing power, and discernment. However, such optimistic accounts often overlook the intricate realities that shape and reshape middle-class existence. Moreover, the advancements of the middle classes do not necessarily lead to broader development benefits for others. Thus, focusing on the middle classes may risk marginalizing economically disadvantaged groups, who are often perceived as being outside the development agenda (Ballard, 2012; Rigg, 2014). At the same time, some governments prioritise support for the poor, leaving the middle class—many of whom remain financially vulnerable—without adequate assistance. These individuals, who have not yet achieved a stable and resilient middle-class status, often do not qualify for various social assistance programs. As a result, they are at risk of economic downturns and downward mobility, as seen in the experiences of middle-class Indonesians in this study. In the context of the middle-income trap at the individual and national level, a 2023 white paper published by the Faculty of Economy and Business at the University of Indonesia highlights trends in economic mobility among Indonesian households between 1993 and 2014. The report shows that 27 % of the middle class experienced downward mobility, while 42 % remained stuck in the same economic class (Dartanto & Can, 2023). A significant portion of the world’s impoverished population resides in middle-income nations, and residing in such a country does not ensure the socio-economic stability of the middle class (Rigg & Sims, 2022). There is evidence that economic inequality and exclusion are visible in Indonesia and Malaysia. In Indonesia, a persistent pattern of J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 2 inequality emerged following the shift to democracy in the late 1990s, reaching its peak in 2011, with income inequality continuing to rise over the past few decades (Tadjoeddin, 2019). Contributing factors include regional disparities, particularly in eastern Indonesia, which lags behind the western regions in infrastructure and economic opportunities. The wealthiest segments of the population have seen much higher growth in incomes and consumption compared to the poorest, leading to persistent poverty, especially in areas like Highland Papua, where about one third of the population lives below the poverty line. As the world’s fourthlargest population, Indonesia faces the complexity of middle-class life. Development has often been concentrated in Java, creating some of the highest population densities globally, while the eastern provinces remain less developed. Additionally, according to Indonesia’s Central Statistics Agency (BPS), the middle class has shrunk from 21.45 % in 2019 to 17.1 % in 2024. This decline is attributed to the government’s classification of the middle class based on monthly spending, which does not accurately reflect their growing economic activities, particularly in sectors like the halal industry. Although the number of people classified as middle class has decreased, the aspiring middle class has grown. The robust spending behaviour of this group is evident in the expansion of industries like halal, which continues to be a key economic driver. While many have moved into the middle class, their incomes often stagnate at levels insufficient for upward mobility into higher-income brackets. This entrapment is particularly evident in sectors like halal, where small and medium-sized enterprises (SMEs) must innovate and upgrade to meet global market standards in order to break free from the trap. As Elias (2020) highlights in the case of Malaysia, competitiveness has become a key policy priority, with strategies aimed at escaping the middle-income trap not only at the national and local levels but also at the individual level—particularly for halal business players. The emphasis on competitiveness aligns with broader economic reforms that seek to enhance Malaysia’s economic standing through benchmarking technologies, policy initiatives, and market-oriented reforms (Elias, 2020). Similarly, Indonesia’s approach to overcoming the middle-income trap at various levels—national, local and individual—focuses on increasing investment in innovation, education, and SME development, aiming to foster long-term sustainable growth (Basri & Pura, 2016; Basri, 2024). For Malaysia, declining inequality invites further and multifaceted exploration, including structural inequalities in labour and asset markets. Income inequality in Malaysia has shown a mixed trend over recent years: official statistics indicate that household income inequality is decreasing. However, wage inequality experienced a slight increase during the 2000s, characterized by rapid growth in the highest income brackets. Additionally, both car and property sales demonstrate a growing concentration of wealth at the top. The distribution within the largest unit trust funds indicates rising inequality, primarily driven by accumulation in the upper-middle income segments. Results align with widespread perceptions of increasing inequality and highlight the complex nature of inequality, emphasizing the significance of structural disparities in labour and asset markets. Additionally, regional and ethnic inequalities persist, particularly between affluent urban areas and poorer rural regions. Notable differences in poverty and income dynamics are pronounced when comparing the affluent urban areas of Peninsular Malaysia with the economically disadvantaged rural regions of East Malaysia. The halal economy is dominant in Peninsular Malaysia and the capital city of Kuala Lumpur in particular. This city and its many affluent suburbs have taken centre stage in middle-class development (Fischer, 2008). An emphasis on gender politics provides a framework for examining the political and institutional changes that have occurred alongside the shift in state economic policymaking towards prioritizing competitiveness. In the context of Malaysia, this policy shift has been further intensified by a pervasive concern that the nation is currently ensnared in a ‘middle-income trap’, coupled with the rise of a more technocratic and corporate-affiliated bureaucracy within the government (Elias, 2020). Arguably, the efforts to reduce ethnic inequality have hindered social equity and fair income distribution: the primary obstacle to Malaysia’s advancement lies more in political and social factors rather than economic ones (Hill, 2012; Jarvis, 2017; Ravallion, 2020). There also remains potential for poverty alleviation through the reduction of inter-ethnic inequalities (Rongen, 2024). Thus, the country faces complex socioeconomic challenges as the implementation of the New Economic Policy (NEP) aiming to create a Malay middle class hinders Malaysia from implementing necessary reforms to move beyond the “middle-income trap” that its economy is currently facing. In sum, the above provides a broader and comparative perspective for our exploration of middle-class development and lifestyles. 3. Middle-class development The concept of class is central to global development debates. While there is an extensive literature on the revitalized relationships between religion, humanitarianism, aid, and development (Barnett & Stein, 2012; Barnett, 2011; Benthall, 2009; Fassin, 2012; Petersen, 2016; Shushan & Marcoux, 2011), the role of religion in shaping global development remains underexplored. Importantly, we explore Muslim middle-class groups in Indonesia and Malaysia in the context of “advancing new Islamic laws, as well as the institutions to administer and enforce them” (Feener & Fountain, 2018: 6). This reflects state-led efforts to integrate Muslim piety into economic frameworks, balancing Islamic and Western development models (Feener, 2013). Despite its significance, the concept of middle class remains imprecise while playing a crucial role in modern economic structures (Wallerstein, 1991). The term lacks a clear definition in global development discourse, yet the emergence of middle-class groups in Indonesia and Malaysia has become an economic focal point. Development studies often emphasise state policies designed to lift people out of poverty by providing necessary resources, opportunities and income. Social mobility is frequently framed as a market of progress, with individuals and groups moving into the middle class. Often, two sociological theories are utilized to examine social structure. The first of these is a Marxist perspective of class that categorizes the population into the capitalist class (financial/industrial), the working class, the petit bourgeoisie (an older middle class consisting of small property owners, independent farmers and business proprietors), and a newer middle class of professionals and service providers in the business and corporate sectors. In this approach to class analysis, the middle class is examined in structural terms: social class is defined by individuals’ ability to consume, which forms the market that capitalism relies on, creating a large consumer base to support significant economic growth in the services and manufacturing sectors (Veltmeyer, 2018). Conventionally, Marxist class analysis informs much of international development thinking and the paradox is that classes in Marxist thinking are historical agents – structural/material formations as well as intersubjective entities – and the challenge is how to reconcile these two aspects (Eagleton, 1990). The second sociological theory is Horner and Hulme (2019, 348) argument for the role of the middle class in global development: “Global middle classes have grown in prominence according to many accounts, while the proportion of the world population living in extreme poverty has fallen dramatically by official measures.” Moreover, “Claims of convergence can be supported by the aggregate GDP performance of the global South, its growing share of middle class population, aggregate carbon emissions, and the reclassification of countries as middle income, and also by health indicators and educational enrolment.” (Horner & Hulme, 2019). The rise of middle classes in the Global South tend to overshadow social mobility in the Global North (Horner, 2020). More broadly, the emergence of global development can be traced back to the 1990s and the end of the Cold War, which led to intensified economic integration and the creation of a common future in an increasingly interconnected world, driven by global development thinking. J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 3 Arguably, multipolar globalization, building on the rapid growth of industrializing economies in the Global South, is reshaping global trade, politics, finance, investment and aid (Pieterse, 2017). In addition, many development issues (e.g., climate change, health, migration, security, inequality) are increasingly framed as global problems that require distinctly global responses and solutions provided by global institutions and policies (Scholte & S¨ oderbaum, 2017). In a special issue of Globalizations (Bowles & Veltmeyer, 2020), there are vibrant and critical debates in both development and global studies regarding the nature and future of class formation. We think that these constitute an important framework for global development while there is room for developing the focus on middle-class lifestyles further in the interfaces between development and globalization. Many arguments against global development focus on what is seen as its conceptual imprecision such as vague/conflicting definitions of the terms development, “the global”, middle and class; its ahistorical nature; disregard for inequality/poverty; and narrow focus on China (Banks & Overton, 2022; Fischer, 2019; Hope, 2022; McKay, 2022; Sumner, 2019). Existing class analyses (Arsel, 2023; Gillespie, Hardy, & Watt, 2021) inspired by global development mostly engage with class as a means to explore climate change or urbanism, for example. Finally, we honour the call to fill the gap between the assertions of worldwide convergence and individuals’ perspectives on incomes and well-being (Bangura, 2019). These factors should be at the forefront of discussions on global convergence. Our analysis shows that contemporary examinations of class and development can advance global development thinking. We believe that a contemporary conceptualization of lifestyle class analysis fills the gaps found in more Marxist-oriented analyses and global development thinking. Arguably, class emerges when individuals with shared experiences identify and express their interests in relation to one another, distinguishing themselves from those with differing and often conflicting interests (Thompson, 1963). Our study of middle-class lifestyles aims to understand class through personal experiences, moving away from the ambiguity and vagueness of the middle-class concept. Our analysis is guided by the suggestion of exploring the complexity of class analysis by examining values, perspectives, lifestyles, moral beliefs, views on social change and political decisions (King, 2008). Our contextualized and comparative analysis of Muslim lifestyles is inspired by approaches that explore how class “are mobilized in a host of displaced registers, its distinctions carried in a myriad of charged, locally modulated signs and objects” (Comaroff & Comaroff, 2000: 306). The development of class consciousness is influenced by how these experiences are culturally handled, including traditions, values, ideas and institutions. We show that urban class projects or lifestyles in the Global South (Liechty, 2002) add specificity to the concept of middle class. The middle class is undoubtedly regarded as a significant factor, yet this “new class” finds itself in an uncomfortable position, reminiscent of the understanding of the changing political positions of the middle classes. They are neither directly in control of the means of production and nor are they able to align themselves with the traditional working classes (Wright, 1996). The global middle classes in emerging economies such as Indonesia and Malaysia signify a key argument in global development: globalization can foster economic progress as well as increasing divisions between or within class groups (Heiman, Freeman, & Liechty, 2012; Koo, 2016; Marsh & Li, 2016). Our study enriches this literature by focusing on the historical/ethnographic aspects of middle-class lifestyles. It is reasonable to argue that the substantial identity of classes primarily results from the actions of social actors within and between those classes. Understanding class and personal class experiences is crucial in explaining the concept of class, and this serves as a prerequisite for effectively navigating class dynamics within social spaces. Our exploration of Muslim lifestyles hinging on the state and markets aims to provide such a framework that. 4. Middle class in context We will now contextualize class transformation in Indonesia and Malaysia. As we shall see, middle-class lifestyles can best be understood by examining their historical/ethnographic contexts, as this avoids conceptual imprecision such as conflicting definitions of the term “middle class”. Moral status signals (such as Muslim piety as an economy) and national repertoires (including history; mass media; the state–market nexus; educational systems; demographic mobility and stratification systems; as well as ethnic diversity) are crucial in the formation of middle-class lifestyles (Lamont, 1992). As the world’s largest Muslim-majority country, Indonesia boasts a prevalent Muslim middle class, with approximately 90 % of its 279 million population identifying as Muslims in 2022. Before and during the Dutch occupation, the opportunities for Indonesians, or the pribumi (indigenous Indonesians), to join the middle class were limited. During the Dutch East Indies period (modern-day Indonesia), the Dutch and Chinese business classes dominated (Mackie, 1992; Robison, 1996). In the late nineteenth and early twentieth centuries, there was only a minor resurgence of Muslim enterprises (Hefner, 1997). Since the country’s independence in 1945, opportunities to build a middle class in Indonesia remained limited, as the era of the first president, Soekarno, was marked by political instability. Economic challenges were also prevalent, evidenced by limited industrialization and restricted education and job opportunities (Liddle, 1992). The transformation of the middle class can be seen especially during the New Order regime (1967–1998) of Indonesia’s second president, Soeharto, which benefitted from the oil boom in the 1970s. The introduction of economic policies, coupled with the expansion of secondary and tertiary education and increased urbanization, marked significant changes (Mackie, 1992). Soeharto’s government emphasized economic development, leading to the expansion of the (Muslim) middle class. This expansion was further driven from the 1980s onwards when the government adopted market liberalization policies, opening up more job opportunities for Indonesians. After the oil boom ended in the 1980s, Soeharto opted for export-oriented industrialization (Hadiz, 2014; Robison, 1996). The Muslim middle class became noticeable in the late 1970s during the Islamic resurgence in Southeast Asia, particularly in Indonesia and Malaysia. The establishment of the Association of Indonesian Muslim Intellectuals (ICMI, Ikatan Cendekiawan Muslim Se-Indonesia) by BJ Habibie in 1990, supported by Soeharto, is important in discussing the growth of the Muslim middle class. Hefner, for example, has shown that the establishment of ICMI, consisting of well-educated, middle-class Muslims, was a political response to the social/economic marginalization of the pribumi middle class (1993, 1997). At the same time, the development introduced by Soeharto also created inequalities, leading many middle-class Indonesians to become disillusioned with his regime. This disillusionment was exacerbated by the economic crisis and the subsequent fall of Soeharto in 1998. Today, no study on Indonesia can avoid discussing its middle-class population, as the majority of the country’s current population now falls into this category. This discussion has gained further significance with the announcement by the World Bank in 2023 that Indonesia has reclaimed its position as an upper-middle-income country, with a gross national income (GNI) per capita of USD $4,580 in 2022 (World Bank, 2024a; World Bank, 2024b), after being downgraded to lower-middleincome country in 2020. The robust purchasing power of the middle class played a substantial role in this achievement. At the national level, Indonesia faces the potential risk of falling into the middle-income trap. The ambition is for Indonesia to escape this trap before 2045, as part of the Indonesia Emas (Golden Indonesia) 2045 vision. The question now is: given Indonesia’s current portfolio, does it have the necessary conditions to continue moving up the economic ladder? As we mentioned earlier, looking the trap at various scales—national, local, and individual—the reality is that Indonesia’s middle class is highly vulnerable to J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 4 poverty and could remain trapped in the same income bracket. Therefore, some analysts suggest that rather than focusing solely on the government’s obsession with becoming a high-income country, it would be more prudent for the government to focus on building a strong middle class (see, for instance, Dartanto & Can, 2023) capable of driving the Islamic economy sector, for example. This is particularly relevant given that the halal industry and the broader Islamic economy have already become integral to Indonesia’s development agenda, as outlined in the Rencana Pembangunan Jangka Menengah Nasional (RPJMN, National Medium-Term Development Plan) 2025–2029 and Rencana Pembangunan Jangka Panjang Nasional (RPJPN, National Long-Term Development Plan) 2025–2045. Abdurrahman Wahid, also known as Gus Dur, the fourth president of Indonesia (1999–2001), argued that unlike the middle class in many other countries, which is predominantly composed of entrepreneurial groups, the backbone of the middle class in Indonesia consists of professionals, civil servants, military officers and academics (1992) and it still holds true today. The difference now is the notable expansion of and emphasis on the middle-class lifestyle. Reflecting on Indonesian history, Gus Dur argued that as the political approach of the Muslim ulama (religious scholars) counter-elite failed to achieve the basic objective of a Muslim state, Muslim middle-class groups responded in two ways: supporting a nationalist agenda and maintaining their distinct cultural identity (Wahid, 1992). This context helps explain why, throughout Indonesian history, middle-class Muslims from various Islamic or Islamist affiliations have been eager to accentuate their distinct Islamic lifestyles. The Chinese dominance in Indonesia has sparked widespread resentment among Indonesians. Anti-Chinese sentiment persists, exacerbated by the economic gap between Muslims and Chinese in business (Hadiz, 2014). In response, the government implemented interventionist policies, such as “trade monopolies in the 1950s; requirements in the 1970s that Chinese business groups allocate equity participation to small (i.e. indigenous) business and that banks favour indigenous investors in credit; preferential allocation of small government contracts in the 1980s” (Robison, 1996: 101). By the 1990s, the Bank of Indonesia mandated that banks allocate 20 % of their loan portfolios to small businesses, contributing to the growth of the small middle class. As previously noted, we emphasize the importance of studying the lifestyle of the Muslim middle class to understand its development in both Indonesia and Malaysia. This approach allows us to explore not only social mobility, as emphasized by Dick (1985), but also modes of consumption and the significance of consumer durables in expressing religious sentiments. The rise of the halal economy or Muslim piety as an economy marks a departure from the application of colonial-era Westernized middle-class lifestyles, described by Dick as adopting a “CocaCola culture”, to contemporary Muslim middle-class lifestyles. Young urban middle-class individuals proudly express their Muslim identity through halal practices. Reflecting this shift, global brands such as CocaCola have secured halal certification and have been fully halal-certified since the 1990s by the Majelis Ulama Indonesia or Indonesian Ulemas Council (MUI) and Jabatan Kemajuan Islam Malaysia or Islamic Development Department of Malaysia (JAKIM). This shift does not imply a convergence with Western middle-class lifestyles (Dick, 1985), but rather signifies an alternative celebration of Muslim middle-class identity, diverging from Western consumer preferences without developing an anti-Western stance. Malaysia has experienced steady growth since gaining independence in 1957, thanks to its efficient bureaucracy and careful macroeconomic management led by the United Malays National Organisation (UMNO), the dominant political party in Malaysia. However, UMNO’s influence has waned in recent years amid shifting political dynamics. The country is progressing towards achieving high-income economy status, with the gap between its GNI per capita and the minimum threshold for highincome economies steadily decreasing. In 2020, the country was 20.4 % below the minimum threshold of USD $12,696, a significant improvement from the 62.6 % gap recorded in 1991 (Economic Planning Unit, 2021: 5). According to the World Bank (2024), Malaysia is classified as an upper-middle-income country. Malaysia has experienced rapid income-poverty reduction, one of the fastest rates globally, over the past five decades. According to the constitution, individuals are considered Malays if they are Muslim, speak Malay (Bahasa Melayu or Bahasa Malaysia) and adhere to Malay customs. The Malay middle class is the largest and fastest-growing segment in Malaysia. In 2024, Malaysia’s population of approximately 34 million is composed of 50 % Malays, 23 % Chinese, 12 % indigenous Bumiputra (literally, sons of the soil) groups other than Malays, 7 % Indians and 1 % other ethnic groups. Non-citizens make up around 8 % of the country’s resident population. Prior to the British colonial period, the main social classes were the aristocracy, the peasantry and a merchant class. With the onset of British economic dominance in the early twentieth century, new classes began to take shape. These emerging classes included a European bourgeoisie, Chinese compradors, Indian moneylenders, a small number of European officers, junior Malay administrators, Asian white-collar workers and a growing proletariat (predominantly Chinese and Indian). The formation of social classes became more evident in the post-independence era (Embong, 1998). Although the state plays a significant role in shaping the Malay middle class, the influence of the market and capitalist modes of production in a global context should not be underestimated. As we shall see, our analysis moves beyond certain Marxist analyses: here, class conflict is identified as the primary driving force of historical change (Jomo, 1986). This perspective portrays class as something inherently deterministic, objective and stable, seemingly beyond direct human influence. The government implemented the New Economic Policy (NEP) in the 1970s and these policies have been in place ever since. The aim of the NEP was to create a Malay middle class, that is, accelerate Malay social mobility vis-` a-vis the Chinese community that is seen as embodying a capitalist and entrepreneurial ethic (lifestyle). As a consequence of the NEP, Malay business ownership rose and in the educational system, not least Islamic education, preferential quotas meant that more Malays were actively contributing to the economy – these changes are fundamental to middle-class lifestyles hinging on education and entrepreneurship. Thus, the Malay middle class is to a large extent a product of UMNO/government policies. Since independence, bold plans in Malaysia have defined the nation’s development strategies. In 1991, PM Mahathir Mohamad, who can be considered the leading figure in modern Malaysian history and architect behind the NEP, launched Vision 2020. This grand plan envisioned Malaysia as a fully developed nation by the year 2020 hinging on the social mobility of the Malay middle class. In the Twelfth Malaysia Plan (Economic Planning Unit, 2021), the Shared Prosperity Vision 2030 or WKB 2030 was introduced as the successor to Vision 2020. Key to WKB 2030 is the national agenda of socioeconomic development of Bumiputera: the aim is to strengthen human capital development; enhance business resilience/wealth creation; and increasing sustainable Bumiputera corporate equity ownership. Specifically, there is a focus on “uplifting” the bottom 40 % of income earners to membership of a middle-class society (Economic Planning Unit, 2021: 5.1). Additionally, more attention will be given to building an effective and accountable public sector to meet rising expectations, driven by advancements in technology and a growing “middle-income class” (Economic Planning Unit, 2021: 13-2). This necessitates the development of extensive training programmes and support systems to cultivate a diverse group of top-tier professionals with the necessary skill sets. The government sought advice from international organizations, most notably the World Bank, to ensure that this developmental agenda is in line with global best practices. Obviously, the Malay middle-class plays a key role in Malaysian development strategies – both within middle-class groups and in government discourse. The emergence of different dakwah groups, which are essentially J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 5 invitations to salvation, during the resurgence of Islam in Malaysia since the 1970s has led to the development of new Malay middle-class lifestyles. Dakwah, which is inseparable form Malay ethnicity and localized politics, confronted secular aspects of the Malaysian state and nation. Similarly, the popular Islamic opposition Parti Islam SeMalaysia (PAS) together with dakwah groups challenged the UMNO-government and the state itself for being overly secular an un-Islamic. Conversely, the state and more secular groups critiqued dakwah and ulama for representing a decline of Islam that arrogantly rejected secular development and knowledge (Milne & Mauzy, 1999). In Indonesia and Malaysia, the rise of the middle class paralleled the region’s economic development from the mid-1980s onwards. In both countries, economic liberalization has been closely linked to the increasing influence of Islam in the public sphere, evident from the emergence of a Muslim piety as an economy, not least the growth of halal industries supported and regulated by state institutions. This relationship between religious resurgence and the growth of the middle class, key to state policies and capitalism, is deepening in Indonesia and Malaysia; that is, middle-class believers are becoming more religious and zealous in expressing their religious lifestyles (Rudnyckyj, 2014). 5. Muslim middle-class lifestyles: Rising affluence and religiosity A Weberian (1978) theory of social stratification focuses on lifestyles, which are integral to class structures, consumption and the social inclusion/exclusion of groups – for example, considering the middle class as a class for itself. However, at the same time, the presence of the Muslim middle class challenges Weber (1966) suggestion that modernization leads to the greater secularization of society. We believe that a contemporary conceptualization of lifestyle class analysis fills the gaps in more Marxist-oriented analyses as well as global development thinking. This approach provides a compelling lens through which to understand the interconnection between social structures and individual actions (Bourdieu, 1984; Dick, 1985; Featherstone, 1987; Haenfler, 2019; Weber, 1978). The assumption of the performativity of social practices (Bourdieu, 1990) is central to the focus on middle-class lifestyles. Middle-class lifestyles are further enriched by specific practices in daily life, leading to the conceptualization of class as a product of human interactions. In both Indonesia and Malaysia, the emergence of middle-class groups is a nationwide phenomenon, but of particular importance in the capital cities and suburbs of Jakarta and Kuala Lumpur. Middle-class lifestyles serve as visible manifestations of the Tiger Cub economies. We will now turn to explore two spheres or dimensions of urban middleclass lifestyles: state and market. 5.1. State: Education and science A key aspect of middle-class lifestyles is the state, that is, education, science and bureaucracies. The issue of middle-class development and education in Indonesia is especially pertinent given the country’s demographic bonus. Indonesia recognizes the vast potential of its large middle class and youthful population, which is crucial for the country’s continued economic growth. This aligns with Elias’s analysis of Malaysia (2020), where the prolonged middle-income trap has made it clear that investing in human capital is vital. For Indonesia, this means expanding programs like Lembaga Pengelola Dana Pendidikan (LPDP, Indonesia Endowment Fund for Education Agency) scholarships, which funds the best young minds to study abroad or in the country to help build the nation. This approach would contribute to fostering a young, and innovative middle class, which is essential for breaking free from the middle-income trap and driving sectors like the Islamic economy and the burgeoning halal industry. However, building human capital must start from the ground up, and what is concerning, investment in early childhood education in Indonesia remains low (Setyonaluri, Ramadhan, & Nathanael, 2023). As Elias (2020) observed in Malaysia, where there is a focus on cultivating skilled, competitive workers to address the middle-income trap, Indonesia faces a similar challenge. It is difficult to conceive of middle-class lifestyles without education as a form of social mobility, especially with the focus on Islamic education in Indonesia and Malaysia. Initially, the middle class in both countries consisted of the educated class. Since the 1970s, however, as education expanded at all levels – primary, secondary and tertiary–it has become a less clear indicator of social class. This is evident in Indonesia, for example, with the rapid expansion of secondary education since the late 1970s, while Malaysia’s education system developed earlier, as evidenced by the significant presence of female students in the 1970 s. In the wake of dakwah movements, education and research in Indonesia and Malaysia were more heavily shaped by Islamization, with governments increasingly funding Islamic education at all levels. Our research shows that while education, particularly tertiary education, is no longer a clear marker of middle-class status, it remains a key driver of class formation by providing individuals with the qualifications and opportunities necessary for occupations and incomes associated with a middle-class lifestyle. Furthermore, the agenda of the “Islamization of knowledge”, within the broader context of the institutionalization and bureaucratization of religious expression, aims to integrate “secular” education and social sciences with Islamic studies. This integration holds particular significance for the growth of the urban Muslim middle class in both countries. In Indonesia, the transformation of Islamic higher education began with the State Institute for Islamic Studies (IAINs) in 1960, evolving into state Islamic universities (UINs) in 2002. This transformation has been instrumental not only in fostering the growth of the Muslim middle class but also in cultivating an urban professional Muslim middle class engaged in halal industryrelated domains, which is especially prevalent in the cosmopolitan capital, Jakarta. Since this transformation, for example, the three most popular majors at UINs nationwide have been Islamic financial management, Islamic economics and Islamic banking. It is noteworthy, however, that the idea of Islamization of knowledge in Indonesia emerged as early as the late 1970s. In Malaysia, the fervour for Islamization of knowledge is notably evident through the establishment of the International Islamic University Malaysia (IIUM) in 1983 and Syed Muhammad Naquib al-Attas’s Institute of Islamic Thought and Civilization in 1987 (Nisa, 2023b). The latest development in Indonesia concerning the interfaces between education, halal-related industries and the state can especially be seen at the end of President Susilo Bambang Yudhoyono’s term, with the issuance of Law No. 33 of 2014 about Halal Product Assurance. This bureaucratization of halal makes obtaining halal certificates mandatory, not voluntary, for products targeting Muslim consumers. This has spurred a significant effort to cultivate an urban professional Muslim middle class capable of meeting this mandate. The National Committee on Sharia Economics and Finance (KNEKS), established in 2016 as a non-structural institution led by the president of Indonesia, has been tasked with accelerating, expanding, and advancing the development of Sharia economics and finance in Indonesia. Since 2019, KNEKS has collaborated with Indonesian universities to prepare human resources for contributing to the development of the halal industry, including Islamic economics. Between 2019 and 2020, KNEKS signed Memoranda of Understanding with 80 universities to design curricula for Bachelor’s and postgraduate degrees in Sharia economics. These collaborations with academics involve developing textbooks tailored for these programmes within the halal industry. In addition, Indonesia’s ambition to become a global leader in the halal sector has led to the establishment of various government-supported halal research centres at universities nationwide, following Malaysia’s earlier initiatives in this field. In the sector of strengthening halal education/science, from 2022 onward, the government, through its National Research and Innovation Agency (BRIN), has established three laboratories with the aim of making them Indonesia’s reference laboratories for halal-related research. The J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 6 substantial growth in these intersections of the state, halal markets and religious piety is particularly evident post the enactment of the Halal Product Assurance law and the increasing presence of a Muslim middle class. In Malaysia, dakwah shaped the educational system and not least higher education. Consequently, the number of government-funded educational institutions at all levels expanded. Many higher educational institutions such as the University of Malaya, the largest and oldest university in the country are found in and around Kuala Lumpur. Other universities include the International Islamic University Malaysia. Education is clearly integral to middle-class lifestyles, but in Malaysia this has taken a unique form: the Islamic Science University of Malaysia (USIM) is home to the Institute of Property Management & Islamic Finance, the Institute of International Fatwa Management & Research, the Faculty of Syariah & Law, as well as the Institute of Halal Research & Management (IHRAM). As a centre of excellence, IHRAM specializes in Islamic research, education and training as well as services, consultation and laboratory analyses with specific focus on halal. For example, the IHRAM laboratory uses technology and techniques to locate pork, alcohol and any other sources of contamination in food/drink. This type of Islamization of knowledge and science in Malaysia build on state support/regulation, dakwah as well as market interests (Fischer, 2015), that is, close cooperation and partnership between research institutions and businesses that wish to comply with halal requirements. An example of a company that cooperates with IHRAM is Nestl´ e, the world’s largest food company. IHRAM and Nestl´ e offer joint Halal@- School workshops with a focus on proper halal awareness among schoolchildren. In response to dakwah, the state Islamized the educational system and education/occupation are essential aspects of Muslim middle-class lifestyles related to the Islamic economy (Sloane-White, 2018). Thus, middle-class lifestyles in Malaysia are to a large extent shaped by these efforts to make Islam, education and science compatible. In sum, a key aspect of Muslim middle-class lifestyles is education, and even curricula in conventional schools are conditioned by Islamic schooling. In both Indonesia and Malaysia, the Muslim piety economy hinges on the nationalization of halal requirements catering to Muslim middle-class concerns, providing assurances of product authenticity and purity through state-regulated certification processes – and education, research and science are key to these processes. 5.2. Market: Consumers and businesses The halal industry is thriving in Indonesia due to the current growth of its main market, the Muslim middle class. Various factors have fuelled the halal frenzy in the country, with the increasing spending power of middle-class consumers being particularly notable. The global trend also points to the growing amount of Muslim spending. For instance, the State of the Global Islamic Economy (SGIE) Report or GIEI (Global Islamic Economy Indicator), first launched in 2013, mentions that Muslim consumers spent USD $2.29 trillion in 2022. This represents a 9.5 % increase in Muslim consumer spending compared to the previous year. In 2023, according to Aqil Irham, the former head of Badan Penyelenggara Jaminan Produk Halal (BPJPH) or Halal Product Assurance Organizing Body, Indonesian Muslims spent approximately USD $135 billion per year. However, the growth of the halal economy in Indonesia remains heavily concentrated within micro, small, and medium enterprises (MSMEs), predominantly located in the western regions of the country. For instance, the top five provinces with the highest numbers of halalcertified products are West Java, Central Java, East Java, Lampung, and Yogyakarta. In contrast, provinces in Eastern Indonesia—including Kalimantan, Sulawesi, Nusa Tenggara, Maluku and Papua—continue to lag significantly behind. Given that MSMEs contribute 61 % of Indonesia’s GDP, and 64.5 % of these enterprises are led by women entrepreneurs, upgrading halal MSMEs is a critical step toward addressing regional disparities and freeing Indonesia from the middle-income trap. From our research, we learned that BPJPH elites, for example, often mentioned that the effort requires not only fostering innovation but also encouraging these enterprises to enhance their products by obtaining halal certification, enabling them to compete in the expanding global halal market. As mentioned above, we believe that focusing on the lifestyles of the Muslim middle class is important for understanding the growth of this group in both countries. This approach enables us to examine not only their income in terms of social mobility (Dick, 1985), but also their “mode of consumption” and, more importantly, how “consumer durables” are used and appreciated in relation to their pious expressions. The current proliferation of halal lifestyle-related consumption, however, represents a different trajectory from the earlier image of middle-class lifestyles prevalent since colonial times in the archipelago. This current Muslim middle-class lifestyle trend can be seen, for example, among urban young middle-class individuals who proudly showcase being Muslim, trendy and cool by wearing stricter Muslim fashion and consuming halal food. Young middle-class Muslims, eager to return to their religion, are particularly important in the development of Islamic-related businesses. These young middle-class Muslims celebrate this understanding: “Semakin kaya, semakin religious, dan semakin sadar tentang halal lifestyle” (The richer they become, the more religious they are, and the more aware they are of the halal lifestyle). This aspect, unfortunately, was not captured in Kompas’s (1992) research on Jakarta’s young professionals in the 1980s. This is understandable because, although the resurgence of piety began in the late 1970s/early 1980s, the noticeable growth of the young middle class becoming more religious has been especially significant from the 2000s onwards. The most notable current development is the growing lifestyle of the hijrah (religious renewal, lit. migration) movement, which emphasizes Muslims transforming into better Muslims (Nisa, 2023a). This movement has gained significant popularity among urban young Muslims, especially following the involvement of public figures who have joined various conservative movements to become better Muslims. Additionally, conservative preachers with halal business ventures have increasingly leveraged social media platforms to creatively engage their young tech-savvy audiences. Hefner (1997) argued that during the 1980s, the new Muslim middle class was primarily inspired by Islamic ethics. Today, we observe a growing trend among young middle-class Muslims who are broadening their engagement with Islamic values. Increasingly, Muslim middle-class individuals recognize that being a middle-class Muslim is not merely about belonging to a “consumer class”; it also encompasses integrating these values into their everyday lives. Consuming halal food and wearing Muslim fashion are not only acts of religious expression but also means of signalling their identity and how these goods shape their lifestyle statements. As a product of human interactions, the concept of class should be seen as relational; it reflects not only how individuals view themselves through their consumption choices but also how they perceive and relate to those around them. Economic growth, political/social stability and modern Islamic institutions (Peletz, 2002) frame the emergence of Malay middle-class lifestyles. Malaysia’s position as a global leader in halal has come about partly because the state nationalized the halal economy since the 1980s and subjected local as well as multinational companies to strict halal regulation. As we saw it in the case of N´ estle above, manufacturing companies offer a lens through which we can explore different middleclass groups in the piety economy (Fischer, 2015): management in companies, regulators/bureaucrats that enforce laws as well as consumers. Among Malay middle-class groups the expanding piety economy is often seen as proper Islamic consumption (Fischer, 2008) in everyday life in households – for example only consuming halal products certified as such by JAKIM. Two opposing Malay middle-class lifestyles, often noted in our research, is worth mentioning here (Fischer, 2008, 2011): one lifestyle is J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 7 characterized by proper Islamic consumption or full support of Muslim piety as economy. Specifically, this lifestyle embodies being fastidious about everyday consumer choices and arguing that the piety economy is elastic and expansive, that is, the availability of products/services considered proper for Muslims is a moral imperative. Conversely, more pragmatically inclined Malays who argue that the piety economy has become excessive and materialistic. A woman informant in her 40s summed up the ambivalence or resistance towards the piety as economy lifestyle: “Islamic belief alone should be fine.” However, the general tendency is to see that “Sharia compliance” is giving shape to an increasingly stringent piety economy dominated by the idealization of Islamic lifestyles. The above findings, which are also applicable to the Indonesian context, are framed by halal in companies – not least multinational companies such as Nestl´ e Malaysia: the first multinational to become fully halal certified in 1994. Certification of halal products provides assurance that these are manufactured, imported and distributed under hygienic and sanitary conditions in the piety economy. Moreover, products and premises for halal manufacturing have been inspected and have earned certification by recognized Islamic bodies such as JAKIM and MUI. An important insight from our research is that with regard to halal, global capitalism has made peace with cultural diversity, that is, multinationals recognize fastidious Muslim middle-class groups and cater for their taste preferences, not least in the piety economies of Muslim Southeast Asia. As noted above, the piety economy is increasingly elastic and expansive. For example, in Jakarta and Kuala Lumpur land, property and shelter are resignified in the context of neoliberalism, financialization, consumer culture and Islamic finance. Islamic banking and finance have been globalized, and the question of riba (interest) is essential in the context of mortgages, loans and personal finance products aimed at middle-class groups (Rethel, Elias, & Tilley, 2020). To sum up, middle-class lifestyles in Indonesia and Malaysia embody the expansion of the elastic and expansive piety economy involving preferences, taste, handling, presentation and context. We see a general adherence to halal principles in our research, demonstrating that Muslim middle-class lifestyles to a large extent are about the piety economy. Halal is key in the histories and cultures of the companies we studied. As one company representative explained, within the last decades, state certification bodies in Indonesia and Malaysia have “disciplined” companies, and companies across Muslim Southeast Asia are faced with this fact. In other words, in Indonesia and Malaysia, regulatory institutions are disciplining companies within the context of a Muslim piety economy dominated by growing middle-class groups. 6. Discussion and conclusion The two upper-middle-income countries of Indonesia and Malaysia exhibit distinct paths of development. Zooming in on the history of middle-class growth, it becomes evident that defining who constitutes the Muslim middle class is not straightforward. However, this study reveals convergence within these two countries regarding the development of the Muslim middle class, shaped significantly by state interventions, especially amid Chinese dominance on the one hand and a Muslim piety as an economy in the context of liberalized markets on the other. The growth of the middle class coincides with a global resurgence of piety, influencing diverse expressions of Muslim lifestyles. The education of indigenous Muslims plays a crucial role in the development of the Muslim middle class. Global market forces, at the same time, have significantly transformed educational institutions in these countries, facilitating the emergence of a professional Muslim middle class. This institutionalization of Islamic knowledge parallels the bureaucratization of halal economic progress, evidenced by policies and regulations introduced in both countries. The increasing presence of an urban Muslim middle class has created a new spectrum of enthusiasm for celebrating Muslim lifestyles. It is important to recognize that middleclass lifestyles can vary widely, with not all middle-class Muslims in these countries opting for a halal lifestyle. Thus, divergence persists even within the domain of Muslim middle-class halal lifestyles, reflecting diverse religious and ideological affiliations. In the context of the Muslim middle class, debates surrounding proper Islamic consumption hold particular significance. The shaping of Muslim middle-class lifestyles occurs at the intersections of revivalist Islam, consumer culture and the ambiguous realm of everyday respectability. There is a tension between the desires of the state and civil society organizations, on the one hand, and the aspirations of individuals in their daily lives, on the other. Both parties seek to establish and maintain cultural, religious and social cohesion. Middle-class lifestyles emerge as mental and social negotiations between the opulence and excess of the elite class and the economic necessities faced by the lower classes. This dynamic is reflected in the ongoing discussion surrounding what constitutes “balanced” or appropriate Islamic consumption. Specifically, a key finding is that the Muslim middle class is conceived as an intersubjective entity or a class for itself within the piety economy. Our informants would often refer to themselves and their children as middle class in terms of education and occupation, living signs of entrepreneurial spirit and social mobility. This again enabled these individuals and groups to practice proper Muslim consumption. The formation of the middle class in Indonesia and Malaysia does not conform to a strictly deterministic, symmetrical, or functional framework, as suggested by certain Marxist analyses, and neither is class formation and the middle class as vague as in global development. More intangible effects of class such as religion and ethnicity are excluded from these analyses. Most of all, we have focused on middle-class lifestyles in the contexts of the state and market, but also noted wider global transformations. Crucially, lifestyles play a vital role in shaping class hierarchies, consumption patterns, and the social integration or exclusion of various groups. They serve as a valuable perspective or means to comprehend the intricate relationship between social frameworks and individual behaviours. Notably, a significant discovery is that often Muslim middle-class individuals and groups in Indonesia and Malaysia perceive themselves as a distinct class entity. This article has demonstrated that middle-class lifestyles in Indonesia and Malaysia are shaped by how religion and ethnicity, more generally, are regulated by state institutions while also being influenced by the globalization of religious markets. Both countries are actively strategizing to escape the middle-income trap at national and local levels, as reflected in their ongoing Islamic economic initiatives. These efforts include building human capital to support innovative and hightechnology industries, expanding the halal industry, and strengthening Islamic financial sectors. However, at the individual level, upward mobility—from the middle class to the upper class or from poverty to the emerging middle class—is not a straightforward process. Economic pressures, coupled with limited government social assistance, make it increasingly difficult for individuals to maintain or advance their socioeconomic position. Becoming a strong, resilient, innovative, and productive middle class is no easy task, as competition intensifies, and many find themselves trapped in the same socioeconomic bracket. Even sustaining middle-class status is challenging. The dynamics of individual and household economic mobility ultimately shape macroeconomic conditions and determine whether a country can break free from the middle-income trap. Debates over what has been termed Muslim piety as an economy frequently navigate multiple scales—local, regional, national and global—within socially and intellectually mobile middle-class circles. While we recognise the potential to speak of a global middle class, we emphasise that historical and contextual perspectives are essential for understanding the specificities of local middle-class lifestyles. The broader discourse on global development remains somewhat abstract, necessitating a more critical exploration of how global development paradigms are applied and the importance of grounding discussions in empirical case studies and rigorous methodological approaches. Thus, we believe that our class analysis pinpoints how arguments for global J. Fischer and E.F. Nisa Research in Globalization 10 (2025) 100276 8