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Zakat and Poverty Alleviation in Tunisia Using the Fuzzy Approach
Abstract
Zakat is one of the five pillars of Islam, which is compulsory to all the well-off Muslims, and it is given to the needy. It is used to fight poverty. This study examines Zakat’s impact on poverty in Tunisia. Using simulated data of individual well-being from Tunisian household survey in 2010, the potential importance of the Zakat to struggle with poverty is highlighted. Fuzzy Poverty Measurement is computed which shows that Zakat does reduce this measurement. The simulation results display a significant decrease of the poverty index of Tunisia’s seven regions, and poverty can be eradicated under cases West regions.
... Zakat is a socioeconomic means of reducing poverty and providing resources to the poor and underprivileged [18,19]. Zakat also plays an important role in addressing the issues of poverty [20,21,22,23]. ...
... According to Bouanani & Belhadj [21] zakat can significantly reduce poverty in Tunisia. Besides, Jedidia & Guerbouj [46] discovered that zakat can stimulate economic growth in a sample of 8 Muslim countries during the years of 2004 until 2017. ...
... The consumer price index, trade openness, population, and exchange rate are all utilized as supporting variables in this study. Due to the scarcity of data, the zakat rate studied in the research is calculated using estimation [21,48,65,78]. The zakat rate was calculated in this study by estimating the collection of investment zakat funds using the following formula in Eq. (4) Zakat Rate ¼ 2:5%* Gross Capital Formation ðcurrent USÞ ...
This research aims to examine the effects of the Islamic social finance (zakat), the Islamic Human Development Index (IHDI), and the quality of governance on poverty alleviation in 39 Organization of Islamic Cooperation (OIC) member countries from 2007 to 2020. This study uses a fixed effect model to analyze the relationship between variables. The findings show that the Islamic human development index, as a proxy for the quality of human resources, supports the reduction of poverty in OIC countries. Furthermore, the zakat, voice and accountability, and trade openness have a negative and significant relationship with poverty. The quality of governance, population, inflation, and exchange rate, on the other hand, has no significant effect on the poverty rate. These findings can be used as the foundation for state government as the policymaker to solve poverty. The uniqueness of this study is the application of the modified human development index based on the five Islamic objectives and empirically investigates its impact on poverty.
... However, we are not aware of a study that integrates blockchain into zakah. Concerning zakah management, it has been carried out in many aspects, including poverty alleviation (Bouanani and Belhadj, 2019;Raimi et al., 2014;Ahmed, 2004) contributions to society (Ibrahim and Ghazali, 2014;Md. Shariff et al., 2011), basic need or kifayah limit (Rohaizan et al., 2021) and zakah management efficiency (Zakaria et al., 2014(Zakaria et al., , 2019. ...
... Thirdly, particularly for the industry and zakah institutions, the paper contributes to promoting good governance and sustainability in zakah management and social finance in general by using a new practice of a transparent system through blockchain. There are vast studies on various aspects of zakah such as zakah and poverty alleviation (Bouanani and Belhadj, 2019;Raimi et al., 2014;Ahmed, 2004) contributions to society (Ibrahim and Ghazali, 2014;Md. Shariff et al., 2011) and efficiency of zakah management (Zakaria et al., 2014(Zakaria et al., , 2019. ...
Purpose
This study aims to explore the perceptions of zakah institutions and the intention of society towards the application of blockchain technology in zakah management.
Design/methodology/approach
The nature of this study is qualitative, attempting to indulge into the contribution of Fintech in Islamic social finance. This study uses a mixed-method to gauge the perception of stakeholders. For the quantitative approach, a survey was carried out focussing on zakah receiver and zakah payer. The data then was analysed based on the technology acceptance model. While interview survey with multiple stakeholders (zakah institutions, JAWHAR and university) was conducted to gauge the perception of zakah institutions in using blockchain technology.
Findings
The findings of this study provide a positive view for zakah institutions to embrace the usage of blockchain in its management, however, there are several concern that needs to be addressed.
Practical implications
This study provides new insights to the body of knowledge especially in the zakah management system and Fintech. Besides, from a managerial aspect, this study contributes to the new practices that could be implemented in zakah institutions.
Social implications
Many people lose jobs and income due to the economic turmoil and COVID-19 pandemic, which makes zakah an important Islamic social finance tool to assist in socio-economic development. It is high time for zakah institutions to implement blockchain especially during this pandemic crisis that requires a more contactless approach to ensure health and safety.
Originality/value
This study is important to encourage Islamic social finance institutions to embrace blockchain technology in providing an efficient service to the development of social and economic.
... It is regarded as one of the most equitable and effective wealth redistribution systems (Powell, 2009). The primary objectives of zakat are to provide resources for the poor, foster economic growth, and mitigate poverty and inequality (Ben Jedidia & Guerbouj, 2021;Nabi et al., 2021;Aziz et al., 2020;Rini et al., 2020;Herianingrum et al., 2020;Bouanani & Belhadj, 2019;Hoque et al., 2015;Abdullah et al., 2015;Ali & Hatta, 2014). ...
Zakat, a core pillar of Islam, serves as an essential tool for wealth redistribution and socio-economic welfare. Despite Indonesia being home to the largest Muslim population globally, research on its zakat potential remains underdeveloped. This study aims to map the zakat potential across 510 cities and districts in Indonesia and propose strategies for optimizing zakat collection. Using the Indicators for Zakat Potential Mapping (IPPZ) framework developed by PUSKAS BAZNAS in 2019, secondary data from various official sources were aggregated to estimate zakat potential by province and zakat object. The results show that DKI Jakarta has the highest potential, totaling IDR 64.5 trillion, followed by East Java and West Java. Zakat on agricultural products, livestock, cash, corporate zakat, and professional income are the key contributors to this potential, with regional variations. The study's novelty lies in its detailed local-level zakat mapping, offering fresh insights into regional zakat potential. Additionally, it presents innovative strategies for enhancing zakat collection through decentralized efforts at the village, sub-district, and city levels, contributing to more effective zakat management and socio-economic development in Indonesia.
... Various instruments of Islamic social finance have been studied extensively across the globe, both theoretically and conceptually (Tamanni et al. 2022). There are also studies that focus on the linkage between Islamic social finance instruments and poverty reduction (e.g., Aziz et al. 2020;Bouanani and Belhadj 2019;Marpaung 2019;Mesawa and Rana 2021;Rahmat and Nurzaman 2019). These studies elaborated on the association between Zakat and poverty reduction in different countries. ...
This study employed a novel methodological perspective to evaluate the impact of Zakat on one of the sustainable development goals (SDGs), i.e., education. The study has employed macrolevel data on Zakat spending collected from the Zakat department of Khyber Pakhtunkhwa, Pakistan, and microlevel data from a renowned national survey, the Pakistan Social and Living Standards Measurement Survey (PSLM). Based on the data set used for empirical analysis, a multilevel model was used to control the effect of intraclass correlation. The findings of this study confirmed that Zakat spending by the public sector reduces deprivation in education. Hence, the households benefiting from Zakat allocations are less likely to face barriers in accessing education. Furthermore, the study shows that educated and female-headed households are less likely to experience deprivation, emphasizing the importance of empowering such households as a strategy to reduce educational inequality. However, the mechanism of Zakat disbursement should be refined and made transparent to pursue SDGs by empowering individuals through quality education, vocational training, and enhancing technical skills, which may ultimately reduce poverty in the country. In addition, the methodology adopted in the study opens doors for further research to decompose the results and design policies accordingly.
... Various instruments of Islamic social finance have been studied extensively across the globe, both theoretically and conceptually (Tamanni et al. 2022). There are also studies that focus on the linkage between Islamic social finance instruments and poverty reduction (e.g., Aziz et al. 2020;Bouanani and Belhadj 2019;Marpaung 2019;Mesawa and Rana 2021;Rahmat and Nurzaman 2019). These studies elaborated on the association between Zakat and poverty reduction in different countries. ...
This study employed a novel methodological perspective to evaluate the impact of Zakat on one of the sustainable development goals (SDGs), i.e., education. The study has employed macrolevel data on Zakat spending collected from the Zakat department of Khyber Pakhtunkhwa, Pakistan, and microlevel data from a renowned national survey, the Pakistan Social and Living Standards Measurement Survey (PSLM). Based on the data set used for empirical analysis, a multilevel model was used to control the effect of intraclass correlation. The findings of this study confirmed that Zakat spending by the public sector reduces deprivation in education. Hence, the households benefiting from Zakat allocations are less likely to face barriers in accessing education. Furthermore, the study shows that educated and female-headed households are less likely to experience deprivation, emphasizing the importance of empowering such households as a strategy to reduce educational inequality. However, the mechanism of Zakat disbursement should be refined and made transparent to pursue SDGs by empowering individuals through quality education, vocational training, and enhancing technical skills, which may ultimately reduce poverty in the country. In addition, the methodology adopted in the study opens doors for further research to decompose the results and design policies accordingly.
... Alternatively, an index may approximate this allocation process, offering a comprehensive perspective on the complex mechanisms governing zakat distribution (Lestari & Auwalin, 2022). Due to the limited availability of data, the zakat rate in this study is estimated, following the approach taken by Mahat & Warokka (2013); Sarntisart (2016); Shaukat & Zhu (2020); and Bouanani & Belhadj (2019). In this study, the zakat rate is calculated from the estimated collection of investment zakat funds using the following formula, as used by Widiastuti et al., (2022). ...
This research aims to analyze the factors that influence the economic growth of a country. This study involves a quantitative investigation using panel data regression in seven mainly muslim nations from 2007 to 2020. The variables used in this research are zakat rate, population, the number of scientific and technical journal articles, and Gross Domestic Product (GDP). This research found that the variables of zakat rate, population, and the scientific and technical journal articles have a partial effect on a country's economic growth. Furthermore, simultaneously, variables such as the zakat rate, population, and the number of scientific and technical journal articles also have a significant effect on economic growth. This research also found that zakat rate as the most influential factor in economic growth. First, the government should create effective policies to increase the level of zakat, such as implementing zakat policies as an income tax deduction. This is expected to enhance zakat collection. Second, stakeholders must collaborate to integrate zakat with other policy instruments to create a comprehensive policy framework. Keywords: Economic Growth, Journal Articles, Population, Zakat ABSTRAK Penelitian ini bertujuan untuk menganalisis faktor-faktor yang memengaruhi pertumbuhan ekonomi suatu negara. Studi ini melibatkan investigasi kuantitatif menggunakan regresi data panel di tujuh negara mayoritas muslim dari tahun 2007 hingga 2020. Variabel yang digunakan dalam penelitian ini adalah tingkat zakat, populasi, jumlah artikel jurnal ilmiah dan teknis, dan Produk Domestik Bruto (PDB). Penelitian ini menemukan bahwa variabel tingkat zakat, populasi, dan artikel jurnal ilmiah dan teknis memiliki pengaruh parsial terhadap pertumbuhan ekonomi suatu negara. Selain itu, secara bersamaan (simultan) variabel tingkat zakat, populasi, dan jumlah artikel jurnal ilmiah dan teknis juga memiliki pengaruh signifikan terhadap pertumbuhan ekonomi. Penelitian ini juga menemukan bahwa tingkat zakat merupakan faktor paling berpengaruh dalam pertumbuhan ekonomi. Penelitian ini memberikan dua rekomendasi. Pertama, pemerintah harus menciptakan kebijakan efektif untuk meningkatkan tingkat zakat, seperti melalui kebijakan zakat sebagai pengurang pajak penghasilan. Ini diharapkan dapat meningkatkan pengumpulan zakat. Kedua, para pemangku kepentingan harus bekerja sama untuk mengintegrasikan zakat dengan instrumen kebijakan lainnya untuk menciptakan kerangka kebijakan yang komprehensif. Kata Kunci: Pertumbuhan ekonomi, Artikel Jurnal, Populasi, Zakat
... Otherwise, it may use an index to approximate this allocation process; therefore, it ensures an enlarged view of the complex mechanisms governing zakah distribution (Lestari et al., 2024). Due to the minimal data availability, in this study, the zakah rate was estimated following the approach used by Resosudarmo et al. (2016) and Bouanani et al. (2019). In this study, the Zakat rate was computed depending upon the estimation of investment Zakat fund collection through the same formula as (Widiastuti et al., 2022). ...
Economic growth plays a crucial role in determining the success of a country's development, with each nation setting stable economic growth targets within its development agenda. The process of economic growth is influenced by various factors that can either drive or hinder the pace of growth. This study aims to analyze the impact of zakah growth, the scientific and technical journal articles, population, and unemployment rates on the economic growth of 10 member countries of the Organization of Islamic Cooperation (OIC) for the period 2002-2022 using a quantitative approach with a random effects panel data regression analysis technique and EViews 12 application for data management. As per the research findings, the variables of zakah and scientific and technical journal articles have a positive and significant relationship with economic growth. The population and unemployment rate have a negative and significant. Therefore, it is recommended that governments should improve efficiency in the management of zakah, allocate more budget for education and research, and formulate policies to promote innovation and collaboration between related sectors. It assists in achieving more awareness of zakah and participation in monitoring the utilization of zakah funds for society. The studies would help to see what variables affect economic growth.
... This outcome aligns with the theory that zakat serves as a socioeconomic tool that provides resources to the poor, thereby reducing poverty (Ali & Hatta, 2014). The primary goal of zakat is to redistribute wealth from rich to poor to achieve social and economic justice, boost economic growth, and reduce poverty and inequality (Bouanani & Belhadj, 2019 (Andrios, 2023). Therefore, efforts from both government and society are necessary to fully realize and distribute zakat potential, thus reducing poverty in Indonesia. ...
IntroductionIn Indonesia, poverty is influenced by a complex set of economic, social, and structural factors. Issues such as economic crises, increasing populations, income levels, long-term unemployment, health problems, low educational background, limited access to goods and services, geographical location, and gender contribute to poverty.Objectives
This study aims to analyze the impact of zakat, the Human Development Index (HDI), the open unemployment rate, and income on poverty in Indonesia from 2013 to 2022.Method
This study used quantitative methods with multiple linear regression analysis using Eviews. Time-series data were sourced from Statistics Indonesia (Badan Pusat Statistik) and the National Amil Zakat Agency (Badan Amil Zakat Nasional). The analysis includes classical assumption tests such as normality, multicollinearity, heteroscedasticity, and autocorrelation tests.ResultsThe findings reveal that zakat, HDI, and income have negative and significant impacts on poverty in Indonesia. This indicates that increases in zakat, HDI, and income lead to reductions in poverty levels. However, the open unemployment rate did not have a significant effect on poverty.ImplicationsThe results highlight the importance of zakat as a socioeconomic tool to reduce poverty by redistributing wealth. Improving human development through better education, healthcare, and economic opportunities is crucial for alleviating poverty. Policies aimed at increasing income levels can significantly reduce poverty rates.Originality/NoveltyThis study contributes to the literature by examining the simultaneous effects of zakat, HDI, the open unemployment rate, and income on poverty across Indonesia, offering insights into effective poverty reduction strategies.
... Miah (2021) looked at the failure of conventional microfinance in alleviating poverty in Bangladesh and shows how zakat has helped to fill the gap by the implementation of different programs that have helped to remove the burden of poverty on the people. Bouanani and Belhadj (2019) looked at the use of zakat as a tool for poverty alleviation in Tunisia. They pointed out the impact of zakat on the people as it significantly caused a reduction in the prevalence of poverty among the people. ...
This paper analyses the idea that zakat should go beyond being a mere charity to being a full-blown economy activity because of its important role as a tool of poverty alleviation among Muslims. This paper argues that this idea by A-Qaradawi is cogent and logical, thus, it presents ways in which Muslim Professionals could get involved and how zakat institutions can go about implementing this idea especially in this new era of digital economy. Using the method of qualitative research analysis, it analyses materials from the library on this idea, points out the lack of research on the Asnaf in the digital economy and explains how Muslim Professionals and Zakat Institutions can work together to help turn zakat into a full-blown economy activity through training centres that will provide Asnafs with the necessary knowledge and tools to navigate the digital economy.
... According to Law Number 23 of 2011, zakat management institutions in Indonesia are divided into two divisions: the BAZ, which the Government established, and the LAZ which community groups can establish. The law responds to citizens' doubts about the management of Zakat; thus, residents are expected to be able to distribute their Zakat through trusted institutions under the auspices of legislation, and there is clarity in the reporting system (Bouanani and Belhadj 2019). Efficient zakat administration necessitates the establishment of zakat institutions that possess symbolic, dominating, and legitimacy structures. ...
BAZNAS should ideally have an excellent reputation for planning, implementing, and distributing to improve social welfare. Quantitative research was employed, involving 100 respondents with a non-probability sample. Data analysis employs structural equation modelling with the Smart PLS 3.2.9 software tool. The research highlights the significance of transparency and accountability in the Amil Zakat institution in Indonesia with regards to the management and distribution of the Zakat model. This will lead to an increase in the Muzakki's knowledge and trust, resulting in improved performance of the Zakat managers and enhanced welfare of the people. ABSTRACT BAZNAS should ideally have an excellent reputation for planning, implementing, and distributing to improve social welfare. Quantitative research was employed, involving 100 respondents with a non-probability sample. Data analysis employs structural equation modelling with the Smart PLS 3.2.9 software tool. The research highlights the significance of transparency and accountability in the Amil Zakat institution in Indonesia with regards to the management and distribution of the Zakat model. This will lead to an increase in the Muzakki's knowledge and trust, resulting in improved performance of the Zakat managers and enhanced welfare of the people. Contribution/value-add: BAZNAS ought to be literate towards muzakki concerning knowledge, distribution patterns, and building trust to enhance their implementation and the well-being of the Islamic community.
... Kata Kunci: Relevansi Sistem Akuntansi Zakat, Lembaga Amil Zakat, Pembangunan Berkelanjutan PENDAHULUAN Zakat merupakan salah satu rukun Islam yang utama dan merupakan ibadah wajib bagi setiap muslim ketika harta yang dimilikinya telah mencapai rampasan dan nisab untuk diberikan kepada yang membutuhkan (Bouanani, 2019, Firdaus, 2019, Syed, 2020, Jedidia, 2021. Zakat adalah bentuk redistribusi kekayaan terpenting dengan tujuan mencapai sistem ekonomi dan sosial Islam yang berkelanjutan (Bin-Nashwan, 2021). ...
Lembaga amil zakat sebagai sebuah lembaga publik yang mengelola dana masyarakat dalam pengelolaannya harus memiliki sistem akuntansi dan manajemen keuangan, yang baik. Pengelolaan dana zakat di Indonesia saat ini masih dalam tahap pengembangan dan perlu ditingkatkan karena potensi pengembangannya yang sangat besar. Salah satu penyebab kurangnya perkembangan lembaga amil zakat adalah belum adanya inisiatif terhadap sistem zakat dan kerjasama dengan lembaga keuangan yang terintegrasi. Sistem akuntansi zakat saat ini bisa digunakan untuk mengelola secara tepat, efisien, dan efektif atas zakat yang dipercayakan kepada organisasi atau lembaga pengelola zakat. Kualitas pelayanan lembaga yang bertanggung jawab dalam pengumpulan, penatausahaan, dan pendistribusian zakat harus dikembangkan berdasarkan kriteria tertentu agar secara efektif mencapai tujuan mulia keadilan sosial ekonomi melalui pendistribusian kekayaan yang baik sesuai dengan ketentuan lembaga amil zakat.Penelitian ini merupakan penelitian lapangan yang menggunakan pendekatan kualitatif asosiatif, dilakukan untuk menganalisis suatu pembahasan dengan membangun hubungan antar situasi atau wilayah sosial satu sama lain, berdasarkan hubungan timbal balik atau interaktif, dengan teknik yang memungkinkan kita mengidentifikasi isi, struktur dan polaritas sosial. dalam representasi suatu fenomena pembahasan yang akan diteliti. Ketepatan pemahaman (subtilitas intellegend) dan ketepatan penjabaran (subtilitas explicand) dalam studi klerikal menjadi sangat relevan bagi penelitian ini. Maka dari itu dalam penelitian ini terdapat beberapa penafsiran (hermeneutik) yaitu penafsiran sistematis dan penafsiran ekstensif atau penafsiran memperluas serta penafsiran antisipasi dalam menjawab suatu isu hukum dengan mendasarkan pada suatu aturan yang belum berlaku.Program pengembangan berkelanjutan lembaga amil zakat di Indonesia penting untuk mengkaji zakat secara detail dalam konteks kerangka kelembagaan, dan pengelolaan kinerjanya. Hal ini disebabkan adanya mekanisme penegakan zakat untuk meningkatkan pendapatan dan menyalurkan zakat sesuai sasaran. Relevansi sistem akuntansi zakat pada pengembangan berkelanjutan lembaga amil zakat didukung juga dengan adanya informasi yang mudah dipahami dan mudah diakses berupa jumlah dana, jarak waktu, cara pelaksanaan, bentuk, bantuan atau program berkelanjutan. Selain itu juga pentingnya publikasi dan media dan adanya laporan berkala mengenai pendayagunaan sumber daya dalam perkembangan umum proyek yang dapat diakses oleh dan khususnya masyarakat penerima bantuan dan pemangku kepentingan yang lain. Kata Kunci : Relevansi Sistem Akuntansi Zakat, Lembaga Amil Zakat, Pengembangan Berkelanjutan
... Thus, the collection and disbursement of Zakat can be accounted for vertically to Allah SWT and horizontally to stakeholders (Triyuwono 2001). Furthermore, good Zakat governance can encourage the achievement of Zakat management goals, namely for social security for Mustahiq (Aibak 2015) to overcome poverty (Abdussalam, Johari, and Alias 2015;Bouanani and Belhadj 2019;Hayati 2015;Johari, Muhammad, and Mohd Ali 2014), and for Mustahiq welfare (Rahmat and Nurzaman 2019). Becker (1964) and Schultz (1972) introduced and initiated the human capital theory (Kuzmin et al., 2020). ...
Asnaf entrepreneurs who experience success prove that Zakat contributes to poverty alleviation of Mustahiq. This study desires to test the effect of knowledge, skills, and abilities variables on the Asnaf entrepreneur's success. The research design used the mono method quantitatively. Testing of the hypothesis is done by using a structural model approach. A questionnaire collected data with clustered random sampling. Respondent is Asnaf entrepreneurs who had received zakat assistance from the National Board of Zakat (Baznas). Their businesses were still running in three provinces (West Java, DKI Jakarta, and Banten). Data has been collected from the Asnaf entrepreneur analysis using the SmartPLS application. The test results on the three dimensions of competency have a positive value. The skill and ability variables significantly affect the Asnaf entrepreneur's success. The test results show an r 2 value of 0.394, which indicates that 39.4% of the Asnaf entrepreneur's success factors are influenced by the three variable. Zakat management entities can respond positively to these findings by increasing the Asnaf competency. These findings become inputs in formulating strategies to perform Mustahiq transformation through the Asnaf entrepreneurial program.
... One of the critical goals of Islamic Social Finance programs is to ensure that sustainability is the empowerment program. However, research on empowerment programs still focuses on impact measurement [6,14,[54][55][56][57]. Others indicate that the empowerment program had not yet fully impacted beneficiaries [19,20,58]. ...
Several previous studies state that the Islamic Social Finance program has not fully succeeded in creating prosperity, and there are no definite measurements to show the sustainability impact of the program. Thus, a measurement is needed to analyze various aspects in achieving the success and sustainability of Islamic social finance programs. This study developed an index for performance evaluation with an emphasis on the success and sustainability of the Islamic Social Finance program. The study used the Analytical Network Process to determine and analyze priority components. Furthermore, the Multistage Weighted Index method was used to calculate the final index score. The index was built by taking into consideration various factors, stakeholders, aspects, and indicators. This study indicates that aspects of funding contribution from donors (0.22), involvement of donors in giving advice (0.99), and controlling of supervisor (0.08) are priority aspects in the success and sustainability of the program. An empirical investigation was performed on three different programs in Indonesia: A, B, and C. Program A (0.81) and C (0.80) have succeeded in improving the beneficiaries’ quality of life to the level of economic resilience, although at a low level of sustainability (76–84.33). On the other hand, program B (0.73) is at the economic reinforcement and has not yet achieved sustainability. This index can be seen as a comprehensive tool for measuring the success and sustainability of the program at several levels.
... Previous research related to the theme of zakat. Zakat as an instrument of Islamic wealth in poverty alleviation (Abdelmawla, 2014;Bouanani & Belhadj, 2019;Mohd Ali et al., 2015;Razak, 2020;Rini et al., 2020;Shirazi & Bin Amin, 2009), The importance of zakat distribution and urbanrural poverty (M. Ahmad et al., 2017;Johari et al., 2014;Sohag et al., 2015), Good governance for Zakat institutions (Amalia, 2019;Wahab & Rahim Abdul Rahman, 2011;Wahyuni-TD et al., 2021), Good governance for Zakat distribution (Binti Mohd Shazilli et al., 2012;M. ...
This article presents a conceptual model for optimizing the absorption of zakat funds in BAZNAS. Islamic culture is an important study in the conceptual framework that will be discussed in this article, in which this culture will involve culture in each target area. The main objective of optimizing the absorption of zakat funds is, of course, to improve the protection of the socioeconomic conditions of the poor. This article uses a literature study approach by collecting data from the relevant scientific literature. Results: This article identifies the right method to optimize the absorption of zakat funds in Baznas. This optimization becomes very important considering that zakat can function as a solution for the socioeconomic welfare of the wider community. Conclusion and suggestions: The conceptual model in this article includes the variable of Islamic culture as the main predictor of the ideas that have been built. The discussion strengthens the researcher's argument for using a cultural approach to optimizing the absorption of zakat funds in the regions. This article presents a conceptual model that can be a consideration for Basnaz in optimizing zakat funds and being useful for further empirical research in the scope of optimizing zakat funds. This article only presents a conceptual framework. Therefore the researcher does not include empirical validation of the ideas the researcher has built. That is why further research is needed to validate the conceptual model presented in this article. The discussion strengthens the researcher's argument for using a cultural approach to optimizing the absorption of zakat funds in the regions.
... These were positive results from this study, including that zakat institutions can alleviate poverty and distribute it to large quantities of the poor. The Bouanani & Belhadj (2019) said the effect of zakat on fighting poverty in Tunisia. This was done through the Tunisian family survey, which was conducted in 2010, and emphasized the importance of Zakat in reducing and combating poverty. ...
The purpose of this research is to explore the potential of the Zakat in poverty alleviation in Nizwa in Sultanate of Oman. The data were collected from Zakat institution (Committee of Zakat and Sadaqat of Wilayat Nizwa) for 3 years (2018 to 2020). The results indicate significant roles of Zakat on poverty alleviation. The findings showed that by direct link, the Zakat have a potentially significant negative contribution to poverty alleviation in Nizwa. The research explored only the potential impact of the Zakat to poverty alleviation in Nizwa in Sultanate of Oman. The findings of the research can be used by government, Islamic charity institutions and policy makers to improve the Zakat effectiveness in reducing poverty.This research provides results showing the ability of Zakat institutions to alleviate poverty. This research recommends a more comprehensive Zakat-based poverty threshold that will hold the multidimensional nature of poverty in for perfect outreach to the most deprived poor.
... In this study, social impact theory was used to analyze the impact of zakat distribution on mustahiq. This is related to the role of zakat in alleviating poverty and increasing the welfare of mustahiq (Abdelbaki, 2013;Abdullah et al., 2015;Bouanani and Belhadj, 2019;Hossain, 2012;Widyatama et al., 2020). Several studies also mention that poverty alleviation programs are carried out through various program fields, including economics (Anis and Kassim, 2016) and various other fields (Atabik, 2015). ...
Zakat management aims to alleviate poverty and improve the welfare of mustahiq. Various instruments for measuring the impact of zakat on mustahiq are needed to measure the achievement of the goals of zakat management. This study aimed to identify and analyze several instruments to measure the impact of zakat. The analysis was conducted by conducting a literature study on various reference sources. The analysis used a descriptive analysis approach and a content analysis approach. The results of this study found four instruments for measuring the impact of zakat: Social Return on Investment (SROI), Center of Islamic Business and Economic Studies (CIBEST), Sustainable Livelihood Impact Assessment (SLIA), and BAZNAS Index for Sustainable Water and Sanitation (BI- WAS). Overall, all instruments can measure the impact of zakat on mustahiq for zakat disbursements to mustahiq
... Unfortunately, in Nigeria, there is nobody or authority that has the legal power to compel zakat payers to pay or investigate whether they pay the correct amount of zakat. Although it is compulsory on all Muslims whose zakatable wealth reaches the minimum, it now becomes somehow voluntary and that makes its collections very low for socio-economic development (Bouanani and Belhadj, 2019). At this juncture, it is worth to remember how Abubakar (RTA), the first Caliph after the death of Prophet Muhammad (SAW), fought those that refused to pay zakat for religious and socio-economic development purposes. ...
Purpose
This paper aims to explore the potential of the awareness and knowledge of Islamic social finance (zakat, waqf and Islamic microfinance) to alleviate poverty during the COVID-19 pandemic with the moderating effect of ethical orientation.
Design/methodology/approach
The data were collected through the administration of paper-based and electronic questionnaires to 400 respondents out of which only 277 were found valid for analysis.
Findings
The study showed that by direct relationship, the awareness and knowledge of Islamic social finance instruments have a potentially significant positive contribution to poverty alleviation during the COVID-19 pandemic except for zakat that has an insignificant positive contribution. Ethical oriental has also a significant positive contribution. Contrary to expectation, the moderating effect of ethical orientation has changed zakat and waqf to have significant negative and insignificant positive contributions, respectively. Only Islamic microfinance has endured the moderating effect to continue contributing significantly and positively to the reduction of poverty.
Research limitations/implications
The study explored only the potential impact of the awareness and knowledge of Islamic social finance to mitigate the extreme poverty caused by the COVID-19 pandemic in Nigeria.
Practical implications
This study clearly showed the need to create enabling laws and policies to support the operations of zakat and waqf institutions to achieve their objectives effectively and efficiently. These two institutions should be integrated with Islamic microfinance for the possibility of getting better outcomes.
Social implications
There should be massive campaigns to restore religious, social and political ethics to enhance the socio-economic development of Nigerians based on the principles of brotherhood.
Originality/value
This study provides unexpected and unusual results showing the inability of zakat and waqf institutions to alleviate poverty due to poor ethical orientation.
... Sebagai gambaran, jumlah muslim mencapai 87,5% (Canggih et al., 2017;Lutfi, 2020). Apalagi posisi zakat adalah salah satu dari lima rukun Islam (Bin-Nashwan et al., 2020;Bouanani & Belhadj, 2019) Untuk itu, diperlukan adanya identifikasi terhadap faktor-faktor yang mendorong peningkatan pencapaian pengumpulan zakat profesi. Hasil penelitian yang dilakukan oleh Fitrianingtyas & Nasution (2019) (Harahap, 2016). ...
The total potential for zakat profession is IDR. 139.07 trillion, or 59.5 percent of total national zakat potential. 233.8 trillion. Meanwhile, the realization only reached IDR. 3.9 trillion or 2.8%. This study aims to analyze the zakat profession from the sharia and
regulatory dimensions. This study uses a qualitative method with a descriptive approach and literature study. The research data was obtained by collecting and reviewing previous research results that were relevant to the theme. The results showed that zakat profession from the sharia dimension is obliged to follow the text of the Alquran
and the fatwas of the ulama to meet the ‘nisab’ limit. Meanwhile, on the regulatory side, professional zakat is comprehensive. It is indicated by the presence of regulations at the macro, meso, and micro levels. Thus, professional zakat has strong legitimacy and can
encourage optimizing the collection and distribution of zakat
... Secara empiris, sebagian dari hasil penelitian menyatakan bahwa zakat memiliki dampak yang positif dan signifikan terhadap pembangunan manusia di beberapa negara Muslim seperti Bangladesh dan Malaysia (Hoque et al. 2015;Suprayitno et al. 2017). Beberapa peneliti menguji besarnya pengaruh zakat dalam mengentaskan kemiskinan suatu negara (Ahmed 2008;Bouanani and Belhadj 2019;Jaelani 2015;Mohammad and Anwar 1991). Di Bangladesh, pengentasan kemiskinan oleh zakat didukung oleh mekanisme penyaluran dana untuk tujuan produksi atau investasi, dan bukan untuk tujuan konsumsi, sehingga pembangunan modal manusia menjadi prioritas utama dalam rangka mengurangi angka kemiskinan (Hoque et al. 2015). ...
The problem of poverty in Indonesia is the manifestation of the powerlessness of the people in accessing state development outcomes. Meanwhile, the development outcome done by the government is only enjoyed by a handful of people because the resource is not equitably distributed. Therefore, the role of zakat is needed to give direct fund to redistribute the wealth, so that human development can be realized. This research aimed to give the empirical result on whether zakat has an influence on human development in Indonesia. This research used the Human Development Index (HDI) indicator as an analysis tool, such as life expectancy, mean year school, and income. Hypotheses testing conducted in 15 years (2004-2018). Data used in this study is secondary data collected by the documentation method. From the regression analysis of Ordinary Least Square (OLS), it is found that zakat can increase human access to health care, education, and can raise revenues. This study provided implication for governments, zakat institutions, and Muslim communities who are obligated to pay zakat, in order to synergize the optimization of zakat funds in Indonesia.
... Various instruments of Islamic social finance have been studied extensively across the globe, both theoretically and conceptually (Tamanni et al. 2022). There are also studies that focus on the linkage between Islamic social finance instruments and poverty reduction (e.g., Aziz et al. 2020;Bouanani and Belhadj 2019;Marpaung 2019;Mesawa and Rana 2021;Rahmat and Nurzaman 2019). These studies elaborated on the association between Zakat and poverty reduction in different countries. ...
This study develops and validates a comprehensive mechanism for evaluating the effect of zakat (obligatory alms-giving) on reducing poverty and attaining the Sustainable Development Goals. The study analyzes the effect of macro-level data on the micro-level data on the district level. Microlevel data is utilized from a renowned national survey, Pakistan Social and Living Standards Measurement Survey (PSLM) from which the Multidimensional Poverty Index (MPI) was computed. Whereas, the macrolevel data has been collected from Zakat & Usher Department Khyber Pukhtoon Khwa. Based on the nature of the data, we used a multilevel model to counter intra-class correlation. The findings confirmed and validated that the novel aspect of the zakat negatively affects the multidimensional poverty and portray significant contribution in targeting several Sustainable Development Goals (SDGs) in Pakistan. Based on the empirical evidence, Zakat being as an obligatory arm which equips individuals to fulfill their necessities, this paper concluded suggests necessary strategies toward zakat disbursement. The mechanism should be refined to stimulate economic growth and pursue SDGs via financial empowerment of less advantaged class of society by reducing poverty in developing countries like Pakistan.
Fintech is not only applied in the banking industry, but also in zakat institutions. Many Islamic countries, including Oman and other Gulf Cooperation Council (GCC) countries, have digitalized their Islamic finance industry, including Islamic institutions such as zakat and waqaf. Nowadays, zakat can also be used to finance small and medium-sized enterprises (SMEs), a process known as productive zakat. This study proposes a blockchain to finance SMEs in Buraimi, Oman, through productive zakat. Such enterprises play an important role in the Omani economy. Their performance has well developed notably in recent years. However, the contribution of the SME sector to the national economy of Oman remains lower than that of other sectors, particularly oil and gas. This indicates that many improvements are needed to enhance SME performance in the country, including in Buraimi. SMEs face many challenges and obstacles in Oman, one of which is financing. Even though the Omani government has supported the financial sector for SMEs, further financing is needed to boost SME performance, particularly in Buraimi. The proposal for a blockchain through productive zakat is expected to be an effective solution for overcoming the financing issues faced by SMEs in Buraimi. It is also expected to become one of the tools used by the Omani government to provide more financing for SMEs in Buraimi, particularly unbanked ones.
Gaps between potential and realization of collection fund ziswaf caused by trust to institution zakat, knowledge about zakat and level of education. Generation Z as a generation that is currently entering productive age and has the potential to be educated to become zakat payers and as a productive group in the field of philanthropy. It is believed that these generation represent a group that is beginning to reach working age and can receive the education required for paying zakat. This research aims to analyze the zakat literacy level of generation Z in Magelang City and Regency. This research was conducted using a quantitative approach. Sample selection was carried out using a purposive sampling technique and a sample of 153 people was obtained through distributing online questionnaires. Hypothesis testing was carried out using quantitative descriptive analysis techniques and independent sample t-test. The research results show that the zakat literacy level of Gen Z is moderate literacy with an average of 75.91. Zakahliteracy is built from two dimensions, namely basic understanding of zakat of 82.01 or high literacy and advanced understanding of zakah of 64.59 or moderate literacy. Furthermore, if we compare the level of zakat literacy based on gender, it is known that there is no significant difference, with a significance value of 0.852, which is greater than 0.05
This study aims to examine research patterns concerning the published zakat index. The studied data came from the Scopus database, which was accessed in its entirety on 13 February 2023. A total of 51 papers were retrieved. The data were analyzed with the Rstudio Bibliometrix program and biblioshiny instruments to determine the research advancements on the Zakat Index. The data demonstrates that the development of zakat index research began in 1994 and has accelerated since 2008. Al-Homaidi, E.A., is the most prolific writer on this subject. Zakat is the most commonly occurring keyword. Malaysia has the highest number of publications and citations on this topic. Malaysia's University Teknologi Mara has the most author affiliations. According to the themes in the zakat index study that has the potential to be expanded, this research has a great deal of room for growth.
Population aging is sweeping the globe. In the foreseeable future, though being replaced soon by India as the most populous nation, China is and will be holding the largest older population in the world. According to the most recent census of China in 2020, the proportion of Chinese older individuals aged 65 years old and above has approached nearly 14 percent, suggesting China is becoming an aged society. This is a huge challenge for China nowadays, especially regarding how to meet the health needs of the large size of older Chinese. Research is thus called for, including but not limited to investigations on the prevalence and trend of chronic diseases and their related risk factors, the transformation of eldercare and healthcare, and evaluations of the policies and interventions of population aging. This Research Topic on Aging and health in China has collected cutting-edge studies on these critical topics from an interdisciplinary perspective, representing the current research progress in this vital field.
Introduction
Although, especially in the past decade, poverty measurement approaches have been duly developed in two paths (from unidimensional to multidimensional poverty and from absolute to relative poverty), merely a few studies have focused on the combination of both perspectives. However, with global aging, poverty among older adults simultaneously presents multidimensionality and relativity characteristics. This paper explores a multidimensional relative poverty index (MRPI) relative to the aged group in four dimensions, namely, health, social, mental, and material, and then empirically evaluates the specific effects on the MRPI of one of the key targeted anti-poverty policies, that is, the health poverty alleviation policy (HPAP), which includes public health service, medical expense reimbursement, rewarding assistance, basic medical insurance, and so on.
Methods
Using pooled cross-sectional data of poverty alleviation from 2014 to 2020 with a total of 83,521 observations aged 60+ in County J, Shaanxi Province in China, we calculate the MRPI for the older adults via a fuzzy set approach. Statistical difference testing is used to analyze the characteristics and trends of the MRPI. In policy evaluation, to address endogenous problems, the treatment effect model based on Heckman's two-stage regression and finite distributed lag model are used with a controlled township cluster structure.
Results
From 2014 to 2020, the MRPI shows a significant upward trend for older adults in rural China, and the health component takes the dominant MRPI position. Empirically, we find that the HPAP can significantly alleviate the MRPI of older adults. Furthermore, among the health poverty alleviation measures, basic medical insurance is the most effective anti-poverty policy to support older adults. Specifically, empirical evidence shows that there is a more statistically significant reduction in the MRPI with the HPAP for the sub-group of older adults with chronic diseases or disabilities.
Conclusion
Both relativity and multidimensionality should be emphasized when analyzing poverty vis-à-vis the aging society, and for this, the MRPI is one of the effective tools. Comparing the relativity with the aged group engenders a more accurate understanding of their poverty situation. Moreover, the importance of the health component among all the four dimensions is more conducive to the detailed analysis of their poverty. The empirical analysis results show that regarding poverty reduction approaches in China, developing integrated health promotion systems is necessary and imminent, especially in the long run, such as long-term care insurance that covers typical disabled older adults with chronic diseases.
This paper aims to develop a model to enhance social justice through zakat in Bangladesh by utilizing donation-based crowdfunding. Whilst being one of the most populous Muslim majority countries, Bangladesh still lacks a centralized policy regarding zakat. Zakat collection and distribution in Bangladesh follows an informally coordinated model which is inefficient. In the absence of required government engagement, solutions are needed to optimize the underutilized potential of zakat.To accomplish this objective, this research employs a qualitative approach. It is found that integrating zakat into a donation-based crowdfunding model is an innovative Islamic fintech approach that can contribute towards improving the socio-economic potential of zakat in Bangladesh. The proposed model has the potential to improve the socio-economic situation of zakat recipients, which can lead to an increased standard of living and enhancement of social justice. The results of this study may enhance the efficiency of zakat and its effects in Bangladesh.KeywordsBangladeshCrowdfundingSocial justiceZakat
The MSMEs-based halal industry is one of the sources that should be taken into account to be developed. This study aims to provide a comprehensive review and analysis of the halal industry and micro, small and medium enterprises (MSMEs) in their efforts to maintain economic resilience during a Covid 19 pandemic. This analysis focuses on theoretical, established and empirical reviews that focus on the halal industry as a new fiscal source. This study uses a literature study review approach for the halal industry from various literature on the halal industry and MSMEs from Indonesia and overseas. The literature is also limited to the publication of 2015-2020. The findings of this study are that halal industry is the newest source of Islamic economics that can be relied on in raising the country's fiscal. Of course, it is intended for poverty alleviation, distribution of consumption, public service media and other relevant instruments. However, the halal industry integration system can become a "new engine" in economic fundamentals that needs synergy and support from various parties from the government, SMEs, and private sector so that the real issues and conditions for economic recovery amid the pandemic can be better. Keywords: Halal Industry; Post-pandemic; Covid-19; Blessings Abstrak: Industri halal berbasis UMKM merupakan salah satu sumber yang harus diperhatikan untuk dikembangkan. Kajian ini bertujuan untuk memberikan ulasan serta analisis yang komprehensif tentang industri halal dan usaha mikro, kecil dan menengah dalam upayanya menjaga ketahanan ekonomi di tengah pandemi Covid 19. Analisis ini fokus pada ulasan teoritis, kebijakan yang telah ditetapkan dan empiris yang menitikberatkan pada industri halal sebagai sumber fiskal baru. Penelitian ini menggunakan pendekatan kajian kepustakaan industri halal dari berbagai literatur industri halal dan UMKM baik yang berasal dari Indonesia maupun dari luar negeri. Literaturnyapun dibatasi dengan durasi terbitan tahun 2015-2020. Penemuan dari studi ini adalah industri halal adalah sumber terbaru ekonomi Islam yang dapat diandalkan dalam menggalang fiskal negara. Tentunya diperuntukkan untuk pengentasan kemiskinan, pendistribusian konsumsi, media layanan publik dan instrumen lain yang relevan. Namun sistem integrasi industri halal untuk menjadi ‘new engine’ dalam fundamental ekonomi perlu sinergi dan dukungan berbagai pihak dari pemerintah, UKM, dan swasata. Sehingga isu dan kondisi riil pemulihan ekonomi di tengah pandemi dapat lebih baik. Kata Kunci: Industri Halal; Pasca Pandemi; Covid-19; Berkah
Individual or household income has been the conventional yardstick of poverty. Presently, non-income factors are universally accepted as measures of poverty. Attention on the multiple dimensions of poverty and their policy implications has been growing in the past 20 years. However, few studies have analyzed relative multidimensional poverty, especially in China. Moreover, the relationship between relative welfare poverty and happiness has been rarely studied, particularly given that the decline of poverty seemed not bringing a significant increase in happiness in China. This research gap is noteworthy because enhancing the subjective well-being of the people is crucial to a nation's sustainable economic development. On the basis of the micro-level data from China General Social Survey, this study puts forward a welfare approach to analyzing the relative multidimensional poverty and then determines the link between relative welfare poverty and individual happiness. Our results show that 1) relative welfare poverty has not declined significantly and 2) there is a significantly happiness-reducing effect of relative welfare poverty.
The MSMEs-based halal industry is one of the sources that should be taken into account to be developed. This study aims to provide a comprehensive review and analysis of the halal industry and micro, small and medium enterprises (MSMEs) in their efforts to maintain economic resilience during a Covid 19 pandemic. This analysis focuses on theoretical, established and empirical reviews that focus on the halal industry as a new fiscal source. This study uses a literature study review approach for the halal industry from various literature on the halal industry and MSMEs from Indonesia and overseas. The literature is also limited to the publication of 2015-2020. The findings of this study are that halal industry is the newest source of Islamic economics that can be relied on in raising the country's fiscal. Of course, it is intended for poverty alleviation, distribution of consumption, public service media and other relevant instruments. However, the halal industry integration system can become a "new engine" in economic fundamentals that needs synergy and support from various parties from the government, SMEs, and private sector so that the real issues and conditions for economic recovery amid the pandemic can be better. Abstrak: Industri halal berbasis UMKM merupakan salah satu sumber yang harus diperhatikan untuk dikembangkan. Kajian ini bertujuan untuk memberikan ulasan serta analisis yang komprehensif tentang industri halal dan usaha mikro, kecil dan menengah dalam upayanya menjaga ketahanan ekonomi di tengah pandemi Covid 19. Analisis ini fokus pada ulasan teoritis, kebijakan yang telah ditetapkan dan empiris yang menitikberatkan pada industri halal sebagai sumber fiskal baru. Penelitian ini menggunakan pendekatan kajian kepustakaan industri halal dari berbagai literatur industri halal dan UMKM baik yang berasal dari Indonesia maupun dari luar negeri. Literaturnyapun dibatasi dengan durasi terbitan tahun 2015-2020. Penemuan dari studi ini adalah industri halal adalah sumber terbaru ekonomi Islam yang dapat diandalkan dalam menggalang fiskal negara. Tentunya diperuntukkan untuk pengentasan kemiskinan, pendistribusian konsumsi, media layanan publik dan instrumen lain yang relevan. Namun sistem integrasi industri halal untuk menjadi 'new engine' dalam fundamental ekonomi perlu sinergi dan dukungan berbagai pihak dari pemerintah, UKM, dan swasata. Sehingga isu dan kondisi riil pemulihan ekonomi di tengah pandemi dapat lebih baik.
Purpose
This study aims to determine the factors that influence the intention to use online platforms in paying zakat in Indonesia.
Design/methodology/approach
This study used the extended unified theory of acceptance and use of technology as the theoretical framework, where zakat literacy is added to the model’s main components (i.e. performance expectancy, effort expectancy, facilitating condition and social influence). Primary data was collected through an online survey involving 223 Indonesian Muslims who have used various online channels to pay zakat and analyzed by using structural equation modeling as the empirical approach.
Findings
The findings indicate that performance expectancy, effort expectancy, facilitating condition and zakat literacy significantly affect the intention to use an online platform to pay zakat in Indonesia. However, social influence is found to be insignificant in this study.
Research limitations/implications
The study used a relatively small sample size compared to the Indonesian population’s size. Thus, the results must be interpreted with the sample observed.
Practical implications
Zakat organizations should make sure that their system is easy for people to make an online zakat payment, as easy access is the most important factor influencing the intention to pay zakat online. They must also increase efficiency and effectiveness of the payment system, enhance quality of the organizational and technical infrastructures and contribute to improving zakat literacy together with other zakat stakeholders.
Originality/value
This study offers new insights related to the quantitative study on digital zakat and behavior of zakat payers, particularly in Indonesia.
This study develops and validates a comprehensive mechanism for evaluating the effect
of zakat (obligatory alms-giving) on reducing poverty and attaining some of the
prominent Sustainable Development Goals. The study unconventionally analyzes the
effect of macrolevel data on microlevel data on district level of Khyber Pakhtunkhwa,
Pakistan. Microlevel data are utilized from a renowned national survey, Pakistan Social
and Living Standards Measurement Survey (PSLM) from which the Multidimensional
Poverty Index (MPI) has been computed, whereas the macrolevel data have been collected
from Zakat & Usher Department Khyber Pakhtunkhwa. Based on the nature
of nested data set, we have used a multilevel model to counter intra-class correlation.
The findings confirmed and validated that the novel aspect of the zakat negatively
affects the multidimensional poverty and portray significant contribution in targeting
several Sustainable Development Goals (SDGs) in Pakistan. Based on the empirical
evidence, Zakat being as an obligatory arm which equips individuals to fulfill their
necessities, this paper suggests necessary strategies toward zakat disbursement. The
mechanism should be refined to stimulate economic growth and pursue SDGs via
financial empowerment of less advantaged class of society by reducing poverty in
developing countries like Pakistan. Moreover, the methodology adopted in the study
opens doors for more enabling and conducive research practices in order to decompose
the results and design policies accordingly.
Poverty is a curse at individual as well as community level. It is a threat to humanity at whatever level it exists. All the societies of the world have made efforts to address this challenge. Islam being the religion of all times has also presented a comprehensive system to alleviate this curse. The present study explores the application of some of these measures in collective way and brought into consideration the Zakat system exercised in Pakistan since 1980. This is hypothesised that weather Zakat disbursement along with other Islamic measures has proved to bail out the poor from poverty.
Descriptive as well as empirical appraisal of the existing system showed that the Zakat disbursement among the poor, needy, destitute, orphans and widows has played a significant role in poverty alleviation. The ARDL approach to cointegration is used to evaluate the short run and long run impact of Zakat disbursement along with the other exogenous variables on poverty. The results of the study show that there is an inverse relationship between poverty and Zakat disbursement both in the short run and long run. The study also investigated the certain flaws in the system operated in Pakistan and suggested the remedies.
This paper is the extended and updated version of Shirazi (2006), which covers 38 OIC-member countries. The paper estimates the resource required and potential zakat collection for poverty elimination. The paper employed the poverty gap index based on US 2.0 a day estimated by the World Bank (2009). Zakat potential has been estimated by employing Kahf (1989) method of estimation with some modifications. The paper finds that half of the sample countries not only meet their resource shortfall by potential zakat collection but also generate surplus funds which are sufficient for the resource deficit countries. The paper suggests pooling of zakat funds from the zakat surplus countries and providing for the resource deficit countries to eliminate the poverty. Keywords: Poverty Alleviation, Resource Shortfall, Zakat Collection. OICMember Countries
Purpose
– Poverty is a plague which has continental manifestation, but its impact is heavily felt in several Muslim majority nations (MMNs), where unemployment, illiteracy, chronic diseases, food shortage, sectarian wars and wave of militancy are surging at alarming rates. The purpose of this paper is to develop a faith-based model (FBM) to complement the conventional poverty reduction models. Experiences have shown that FBMs find more acceptability among Muslim nations because they have theoretical and theological underpinnings from the Qur’an and Hadith, as opposed to conventional models that are often viewed with suspicion, sequel to Islamic revivalism.
Design/methodology/approach
– This research adopts a qualitative research method relying on secondary data/information sourced from CIA Factbook, previous scholarly works, working papers, case studies and relevant internet resources. In line with methodological approach of qualitative research, the secondary data/information were subjected to content and thematic analyses (CTA) from which facts, figures and presumptions were derived to support the FBM.
Findings
– The paper justified the plausibility of integrating corporate social responsibility (CSR), Waqf system (WS) and Zakat system (TZS) as FBM for poverty reduction, enterprise development and economic empowerment in MMNs.
Research limitations/implications
– The gap left behind by the paper is for future researchers to carry out an empirical investigation on the viability or otherwise of the FBM. This could include the governance structure, operational modalities and regulatory frameworks that would enhance the functioning of the FBM.
Practical implications
– FBM framework is practically a corporate social investment (CSI), which would be heavily funded by Zakat payers, CSR donations and Waqf. The funds would be deployed to poverty reduction in a number of ways ranging from training, micro-credit support for SMEs, apprenticeships, setting up technology business incubation centres, cluster development, infrastructural development in industrial parks, as well as providing welfare support services to the poor, marginalised communities and other economically disadvantaged groups.
Originality/value
– The theoretical research is a contribution to theory and practice of CSR in the field of management and Islamic economics. It has developed a FBM for adoption by MMNs who are hesitant in adopting western model for fear of compromising their ethical values.
The paper estimates the resource gap for poverty reduction and potential of Zakāt and Waqf in the IDB member countries. 1 Paper stresses on revival of the Zakāt and Awqāf institutions and their enforcement, which will enable the IDB MCs to generate sufficient revenue for their all pro-poor expenditures. For any tangible results, the institutions of Zakāt and Waqf need to be integrated into the poverty reduction strategy of the IDB member countries. The proceeds of these institutions should be made as a part of their pro-poor budgetary expenditures.
In spite of her natural endowment and resources, most Nigerians are still languishing in abject poverty. Seventy percent of Nigerians live below poverty line and there is nothing to write home about in all her sectors. Both the military and civilian governments in the country, in their bid to alleviate poverty among its citizenry have come up with numerous programmes. There are equally some non-governmental organizations established for the same purpose. With these efforts, the problem of poverty still persists in the country. It is identified that the secular orientation of Nigerians has influenced them to view material conditions as the only ingredients of well being of the society. We thus feel strongly that our government could borrow a leaf from the institution of zakat as enshrined in the Qur'an and Sunnah of the Prophet and practiced by the companions. This ranges from the issues of nisab, percentage to be deducted, its distributions and the mode of collection.
This study attempts to examine the effectiveness of monthly zakat distribution as a
mechanism to poverty reduction in the state of Kelantan, Malaysia. The target
population of this study is the poor and needy zakat recipient of the Kelantan Zakat
Department, (MAIK). 481 respondents were randomly selected from Kelantan’s
zakat recipient’s list from the poor and needy category for ten districts of Kelantan.
In depth interview were used to gather the data. For analysing the data, descriptive
statistics were applied. Results indicate that zakat elasticity is about 0.46, suggesting
that, holding other variables constant, if the zakat distribution goes up by 1 per cent,
the monthly income goes up by 0.46 per cent. Further, the male coefficient is about
0.15, meaning that the male gender receives about 0.15 per cent more income
compare to female gender, again holding other variables constant. Thus, zakat
distribution is significant in determining the income distribution among this group
and bringing positive effect towards improving the income distribution of this
group. Thus, these statistical measures have proven the positive role of zakat in
reducing poverty among the Poor and needy and once again prove our result from
previous poverty measures
The core principles of Islam lay great emphasis on social justice, inclusion, and sharing of resources between the haves and the have nots. Islamic finance addresses the issue of "financial inclusion" or "access to finance" from two directions -- one through promoting risk-sharing contracts that provide a viable alternative to conventional debt-based financing, and the other through specific instruments of redistribution of the wealth among the society. Use of risk-sharing financing instruments can offer Shariah-compliant microfinance, financing for small and medium enterprises, and micro-insurance to enhance access to finance. And redistributive instruments such as Zakah, Sadaqat, Waqf, and Qard-al-hassan complement risk-sharing instruments to target the poor sector of society to offer a comprehensive approach to eradicating poverty and to build a healthy and vibrant economy. Instruments offered by Islam have strong historical roots and have been applied throughout history in various Muslim communities. The paper identifies gaps currently existing in Organisation of Islamic Cooperation (OIC) countries on each front, that is, Shariah-compliant micro-finance and financing for small and medium enterprises and the state of traditional redistributive instruments. The paper concludes that Islam offers a rich set of instruments and unconventional approaches, which, if implemented in true spirit, can lead to reduced poverty and inequality in Muslim countries plagued by massive poverty. Therefore, policy makers in Muslim countries who are serious about enhancing access to finance or"financial inclusion"should exploit the potential of Islamic instruments to achieve this goal and focus on improving the regulatory and financial infrastructure to promote an enabling environment.
Zakat is an important form of religiously-mandated charity under Islam. This paper examines its impact on income inequality in Pakistan. Data from 1987–88 are used to construct two income distributions-one that would have obtained if zakat had not been given, and one that did obtain when such giving took place. Atkinson-Kolm-Sen relative indices of income inequality are computed which show that zakat does reduce measured income inequality in Pakistan. Both intra-province and inter-province components of over-all inequality decline, though the amount of change is small.
So give to the kinsman his due, and to the needy, and to the wayfarer. That b best for those who seek Allah's countenance.
The Koran
Fuzzy sets theory has successfully accommodated the lack of clear-cut boundaries of poverty and its gradual nature. On the other hand, uncertainties related to lack of knowledge and imprecision in poverty data need also to be accounted for. The accuracy of poverty analysis is highly subject to how well these features are adequately addressed. We argue that possibility theory is an appropriate framework to deal with incomplete knowledge in poverty. Indeed, considering “the possibility of poverty” instead of the “probability of poverty” allows us to achieve a more realistic handling of this phenomenon. Empirical possibility distributions of monetary poverty states are derived based on our previous works and alpha-cut analysis is used to explore their features. Also, collective possibilistic poverty measures for each state are computed along with an aggregate possibilistic poverty ratio. This possibilistic modeling is applied to the analysis of poverty in Tunisia in 2005 and 2010.
Well-known indices for the measurement of poverty traditionally refer to income (or to other economic variables, such as consumption) and to the conventional definition of a poverty line (see, e.g., Sen 1976; Carbonaro 1982; Foster 1984; Atkinson 1987; Hagenaars 1987; Pyatt 1987; Dagum et al. 1988; Cerioli 1989).
The use of zakat for income generation is a mechanism where zakat wealth is distributed in a way that helps eligible recipients to generate their income, so that they could be permanently independent after a specific period of time. The idea of such a mechanism, although considerably discussed by many contemporary scholars, is not totally new as it has also been briefly mentioned by some classical jurists. This article thus discusses the concept and proposed mechanism of income generation through zakat underlined by a number of modern scholars together with its related issues of fiqh. This is due to the fact that the zakat as a religious obligation must accordingly adhere to the principles underlined bySharìah beside any other economic objective which it strives to achieve.
Fuzzy conceptualization of privation has been a step closer to more realistic handling of poverty. However, fuzzy approaches to poverty are still grounded on parametric axioms. Moreover, construction of poverty lines within these approaches still relies on ad-hoc methods. In this paper, we advance instead a fuzzy procedure based on the non-parametric bootstrap method, allowing us to depict fuzzy unidimensional privation states with boundaries drawn spontaneously from data. Fuzzy non-parametric measures of privation within each state as well as a collective fuzzy non-parametric index of poverty are derived, along with their corresponding confidence intervals. The new approach is applied to the analysis of poverty in Tunisia in 2005.
The paper studied the role of zakah and macroeconomic policies aimed at growth of income and providing opportunities to the poor in eliminating poverty. Simulation of various macro- regimes and zakah schemes for Bangladesh indicate that while macroeconomic policies play an important role in reducing poverty, poverty cannot be eliminated without using zakah in an effective way. The paper also suggests that there are certain conditions under which zakah will be able to make an impact on poverty. First, zakah has to be complimented by robust macroeconomic policies that enhance growth and also redistribute income to eliminate poverty. Second, while more zakah has to be collected and disbursed, the impact on poverty will only be significant when a larger percentage of zakah proceeds are used for productive purposes. Given the important role of zakah in poverty alleviation, there is a need for countries to integrate this vital faith-based institution in the development strategy and programs of Muslim countries, including Bangladesh.
the analysis of deprivation is usually seen as a unidimensional condition. However, recently it is considered to be a multidimensional one. A useful tool for such analysis is to view deprivation as a degree providing a quantitative expression to its intensity for individuals. Such fuzzy conceptualisation has been widely adopted in poverty and deprivation research. This paper aims to further develop and refine this strand of research. First, we re-examine two aspects introduced by the use of fuzzy measures, as opposed to conventional poor/non-poor dichotomous measures, namely the choice of membership functions and the rules to manipulate, resulting fuzzy sets. Secondly, we propose fuzzy monetary and non-monetary measures with the membership functions of poor and non-poor. An application based on individual well-being data from Tunisian households in 1990 is presented to illustrate use of one of the proposed concept.
The rapid development of complex income taxation and welfare systems in the 20th century may give the impression that progressive wealth redistribution systems are uniquely modern. However, religious systems provided similar mechanisms for addressing economic injustice and poverty alleviation centuries earlier. Zakat is the obligation of almsgiving and is the third pillar of Islam - a requirement for all believers. In the early development of the Islamic community, zakat was collected as a tax by the state and the funds were distributed to a defined set of needy groups. As a theoretical matter, there are three insights that make zakat an especially relevant subject for modern legal scholars. First, zakat is an example of a modest wealth tax combined with an income tax that may be illustrative in the discourse regarding wealth taxes. Second, the jurisprudence of zakat supports the ethical conclusions of scholars who contend that property rights are attached to post rather than pre-tax income. Third, to the extent that zakat is considered a principal source of revenue for public programs, it might imply a limited role for government, focusing on equitable distribution of goods. This paper begins with a thorough evaluation and synthesis of the traditional Islamic jurisprudence related to zakat. The next section identifies three broad approaches to zakat adopted by modern Muslim states, with particular emphasis on ways that zakat is institutionalized legally. This is followed by an empirical analysis of the correlation of the approaches to zakat with (1) individual income and (2) wealth stratification. The article concludes with observations and policy recommendations related to zakat and broader legal theory based on the earlier qualitative analysis and empirical findings.
A fuzzy set is a class of objects with a continuum of grades of membership. Such a set is characterized by a membership (characteristic) function which assigns to each object a grade of membership ranging between zero and one. The notions of inclusion, union, intersection, complement, relation, convexity, etc., are extended to such sets, and various properties of these notions in the context of fuzzy sets are established. In particular, a separation theorem for convex fuzzy sets is proved without requiring that the fuzzy sets be disjoint.
This essay focuses on two questions: How do the current economic systems and institutions of Muslim countries differ from those of other countries at the same stage of economic development? What is the impact of Islam on the economic and social performance of these countries? Employing a cluster analysis I find that there is no special Muslim economic system; moreover, few economic institutions are uniquely Muslim. Using a regression analysis I also find that the presence of Islam has relatively little influence on most economic or social performance indicators. In the analysis of Muslim economies, religion does not appear to be a useful explanatory variable.
Even though poverty indices with axiomatically sound properties have been advocated for several decades, most empirical studies of poverty in Australia and elsewhere continue to use the crude, but easily understood, head-count ratio. The difficulty of interpreting the axiomatically more desirable indices is a major reason why their use has been resisted in applied poverty measurement. This paper demonstrates how the more sophisticated poverty indices can be converted into a form that is readily interpreted as a measure of poverty intensity of a group, relative to the population to which the group belongs. The resulting poverty-intensity index is easy to understand and it retains the axiomatic properties of the poverty index on which it is based. We apply the method to Australian data. Poverty measures reported previously in the literature are converted into measures of poverty intensity and interpreted accordingly. We also calculate and interpret some new measures of poverty and poverty intensity using the 1996-97 Income and Housing Costs Survey, Australia (Australian Bureau of Statistics 1997). It is hoped our procedure will lead to wider use of poverty indices that are theoretically superior to the head-count ratio.
Shariah and Historical Aspects of Zakah and Awqaf. Background, paper prepared for Islamic Research and Training Institute
- M Kahf
Malaysia and Islamic Economics. International Center for Education in Islamic Finance (INCEIF), (Paper presented at the Hadhari Economics Roundtable Conference
- S A Rosly
Impact of Zakat Distribution on Poor and Needy Recipients: An Analysis in Kelantan
- Fahme A Ahmad
- R Aziz
- F Ab
- N Ibrahim
- F Zaleha
- Johari
Notes and Comments: A Class of Decomposable Poverty Measures
- J Foster
- J Greer
- E Thorbecke
Roles of Zakah and Awqaf in Poverty Alleviation. Jeddah: Islamic Development Bank
- H Ahmed