Islamic Philanthropy and Poverty Reduction in Indonesia: The Role of Integrated Islamic Social and Commercial Finance Institutions

  • Azwar Iskandar Sekolah Tinggi Ilmu Islam dan Bahasa Arab (STIBA) Makassar
  • Bayu Taufiq Possumah Universiti Malaysia Trengganu
  • Khaerul Aqbar Sekolah Tinggi Islam dan Bahasa Arab (STIBA) Makassar
  • Akhmad Hanafi Dain Yunta Sekolah Tinggi Islam dan Bahasa Arab (STIBA) Makassar
Abstract views: 1448 , PDF downloads: 1166
Keywords: Philanthropy; Integration; Social and commercial finance; Poverty

Abstract

The recent studies about the role of Islamic philanthropy in addressing socio-economic problems have been growing and confirming its significant role in overcoming the problem. This is in line with the existence of regulations that support the effectiveness of its role in poverty reduction in Indonesia, such as Law No. 23 of 2011 on Zakat Management and Law No. 41 of 2004 on Waqf. This study has two objectives. First, to analyze the impact of Islamic philanthropy on poverty reduction as the socio-economic problems in Indonesia in the short and long run. Second, to analyze the effectiveness of integrated Islamic commercial and social-economic or finance to address the poverty compared to unintegrated one. This study used Auto-Regressive Distributed Lag (ARDL) approach to analyze annual data for the period of 2002-2019 while investigating the long and short-run relationships among variables. It found that Islamic philanthropy reduces poverty both in the short and long run, particularly in the integration of Islamic social and commercial finance in a single model. The government should therefore include Islamic philanthropy or other Islamic social finances as a fundamental strategy for building financial stability and sustainable development. (Menjamurnya studi-studi terbaru terkait peran filantropi Islam dalam mengatasi masalah sosial-ekonomi telah mengkonfirmasi peran pentingnya dalam mengatasi masalah ini.  Hal ini sejalan dengan adanya regulasi yang mendukung efektivitas perannya dalam pengentasan kemiskinan di Indonesia, seperti Undang-Undang Nomor 23 Tahun 2011 tentang Pengelolaan Zakat dan Undang-Undang Nomor 41 Tahun 2004 tentang Wakaf. Penelitian ini memiliki dua tujuan. Pertama, untuk menganalisis dampak filantropi Islam terhadap penurunan tingkat kemiskinan sebagai sebuah permasalahan sosial-ekonomi di Indonesia, baik dalam jangka pendek maupun jangka panjang. Kedua, untuk menganalisis efektifitas integrasi atau antara filantropi dan komersial dalam kerangka ekonomi Islam dalam mengatasi permasalahan kemiskinan. Penelitian ini menggunakan pendekatan Auto-Regressive Distributed Lag (ARDL) untuk menginvestigasi hubungan jangka pendek dan jangka panjang antara filantropi Islam dan tingkat kemiskinan selama periode tahun 2002-2019. Penelitian ini menemukan bahwa filantropi Islam dapat menurunkan tingkat kemiskinan baik dalam jangka pendek maupun jangka panjang. Penelitian ini juga menemukan bahwa ketika filantropi dan komersial dalam kerangka ekonomi Islam diintegrasikan, tingkat kemiskinan dapat diturunkan baik dalam jangka pendek maupun jangka panjang. Pemerintah seyogiyanya menempatkan filantropi Islam sebagai kebijakan dan strategi fundamental dalam rangka mewujudkan stabilitas keuangan dan pembangunan berkelanjutan.)

Downloads

Download data is not yet available.

References

Abdelbaki, Hisham Handal. “The Impact of Zakat on Poverty and Income Inequality in Bahrain.” Rev. Integr. Bus. Econ. Res 2, no. 1 (2013).

Abdullah, Naziruddin, Alias Mat Derus, and Husam-Aldin Nizar Al-Malkawi. “The Effectiveness of Zakat in Alleviating Poverty and Inequalities: A Measurement Using a Newly Developed Technique.” Humanomics, 2015.

Abdurrohman Kasdi. “Filantropi Islam Untuk Pemberdayaan Ekonomi Umat (Model Pemberdayaan ZISWAF Di BMT Se-Kabupaten Demak.” Iqtishadia: Jurnal Kajian Ekonomi Dan Bisnis Islam STAIN Kudus 9, No. 2 (2016): 227–45.

Abidin, Zainal. “Meneropong Konsep Pertumbuhan Ekonomi (Telaah Atas Kontribusi Sistem Ekonomi Islam Atas Sistem Ekonomi Konvensional).” Al-Ihkam: Jurnal Hukum Dan Pranata Sosial 7, No. 2 (2014): 113–26.

Ahmed, Habib. “Zakah, Macroeconomic Policies, and Poverty Alleviation: Lessons from Simulations on Bangladesh.” Journal of Islamic Economics, Banking and Finance 4, no. 2 (2008): 81–105.

Aqbar, zwar Iskandar and Khaerul. “Reposisi Praktik Ekonomi Islam: Studi Kritis Praktik Ekonomi Islam Di Indonesia.” NUKHBATUL’ULUM: Jurnal Bidang Kajian Islam 5, No. 1 (2019): 39–53.

Ascarya. “Baitul Māl Wat Tamwil (BMT): An Integrated Islamic Social and Commercial Financial Institution in Indonesia,” 2018.

———. “Integration of Islamic Commercial and Social Finance in Micro-Small Scale.” Surabaya, 2016.

Ascarya, Ascarya. “BAITUL MAAL WAT TAMWIL (BMT): AN INTEGRATED ISLAMIC SOCIAL AND COMMERCIAL FINANCIAL INSTITUTION IN INDONESIA,” 2017.

Atkinson, Anthony B. “Can We Reduce Income Inequality in OECD Countries?” Empirica 42, no. 2 (2015): 211–23.

Ayuniyyah, Qurroh, Ataul Huq Pramanik, Norma Md Saad, and Muhammad Irwan Ariffin. “The Comparison between Consumption and Production-Based Zakat Distribution Programs for Poverty Alleviation and Income Inequality Reduction.” International Journal of Zakat 2, no. 2 (2017): 11–28.

———. “Zakat for Poverty Alleviation and Income Inequality Reduction: West Java, Indonesia.” Journal of Islamic Monetary Economics and Finance 4, no. 1 (2018): 85–100.

Bayinah, Ai Nur. “Role of Zakat as Social Finance Catalyst to Islamic Banking and Economic Growth.” International Journal of Zakat 2, no. 2 (2017): 55–70.

Baznas, Pusat. Outlook Zakah Indonesia 2018. Jakarta: Pusat Baznas, 2018.

Beik, Irfan Syauqi. Economic Role of Zakah in Reducing Poverty and Income Inequality: A Case Study in the Province of DKI Jakarta, Indonesia. Jakarta: LAP Lambert Academic Publishing, 2013.

———. “Potensi Zakah Nasional 2020 (Potential of 2020 National Zakah).” 18. Jakarta, 2020.

Bremer, Jennifer. “Zakat and Economic Justice, Emerging International Models and Their Relevance for Economic Growth.” In World Zakat Forum, WZF: New York, 2014.

Choiriyah, Evi Aninatin Ni’matul, Abdul Kafi, Irma Faikhotul Hikmah, and Imam Wahyudi Indrawan. “Zakat and Poverty Alleviation in Indonesia: A Panel Analysis at Provincial Level.” Journal of Islamic Monetary Economics and Finance 6, no. 4 (2020): 811–32.

Clarke, G, L Xu, and H F Fou. “Financial and Income Inequality: Test of Alternatives Theories.” World Bank Policy Research Paper, WPS 2984 (2002).

Dollar, David, and Aart Kraay. “Growth Is Good for the Poor.” Journal of Economic Growth 7, no. 3 (2002): 195–225.

Evi Aninatin, Ni’matul Choiriyah, Abdul Kafi, Irma Faikhotul Hikmah, Imam Wahyudi Indrawan. “Zakat and Poverty Alleviation in Indonesia: A Panel Analysis at Provincial Level.” Journal of Islamic Monetary Economics and Finance 6, No. 4 (2020): 811–32.

Faisal, Faisal. “SEJARAH PENGELOLAAN ZAKAT DI DUNIA MUSLIM DAN INDONESIA (Pendekatan Teori Investigasi-Sejarah Charles Peirce Dan Defisit Kebenaran Lieven Boeve).” Analisis: Jurnal Studi Keislaman 11, no. 2 (2011): 241–72.

Hoque, Nazamul, Mohammad Aktaruzzaman Khan, and Kazi Deen Mohammad. “Poverty Alleviation by Zakah in a Transitional Economy: A Small Business Entrepreneurial Framework.” Journal of Global Entrepreneurship Research 5, no. 1 (2015): 1–20.

Hoque, Nazamul, Abdullahil Mamun, and Abdullah Mohammad Ahshanul Mamun. “Dynamics and Traits of Entrepreneurship: An Islamic Approach.” World Journal of Entrepreneurship, Management and Sustainable Development, 2014.

Johari, Fuadah, Muhammad Ridhwan Ab Aziz, and Ahmad Fahme Mohd Ali. “The Role of Zakat in Reducing Poverty and Income Inequality among New Convert (Muallaf) in Selangor, Malaysia.” Online Journal of Research in Islamic Studies 1, no. 3 (2014): 43–56.

Juhari. “Reinstrumentasi Fungsi Zakat Menuju Pengentasan Kesenjangan Sosial Ekonomi Umat.” Al-Ihkam: Jurnal Hukum Dan Pranata Sosial 1, No. 1 (2012): 113–26.

Kasri, Rahmatina A. “Effectiveness of Zakah Targeting in Alleviating Poverty in Indonesia.” Al-Iqtishad: Jurnal Ilmu Ekonomi Syariah 8, no. 2 (2016): 169–86.

Latief, Hilman. “Contesting Almsgiving in Post-New Order Indonesia.” American Journal of Islamic Social Sciences 31, no. 1 (2014): 16–50.

Mahmud, Mek Wok, and Sayed Sikandar Shah. “The Use of Zakat Revenue in Islamic Financing: Jurisprudential Debate and Practical Feasibility.” Studies in Islam and the Middle East 6, no. 1 (2009): 1–15.

Mohsin, Magda Ismail A, and Magda Ismail. “Potential of Zakat in Eliminating Riba and Eradicating Poverty in Muslim Countries.” EJBM-Special Issue: Islamic Management and Business 5, no. 11 (2013): 114–26.

Narayan, Paresh Kumar. “The Saving and Investment Nexus for China: Evidence from Cointegration Tests.” Applied Economics 37, no. 17 (2005): 1979–90.

Narayan, Paresh Kumar, Dinh Hoang Bach Phan, Kannan Thuraisamy, and Joakim Westerlund. “Price Discovery and Asset Pricing.” Pacific-Basin Finance Journal 40 (2016): 224–35.

Obaidullah, Mohammed. “Introduction to Islamic Microfinance.” Mohammed Obaidullah, INTRODUCTION TO ISLAMIC MICROFINANCE, IBF Net Limited, 2008.

———. “Role of Microfinance in Poverty Alleviation: Lessons from Experiences in Selected IDB Member Countries.” Mohammed Obaidullah, ROLE OF MICROFINANCE IN POVERTY ALLEVIATION: LESSONS FROM EXPERIENCES IN SELECTED IDB MEMBER COUNTRIES, Islamic Development Bank, 2008.

Pesaran, M Hashem, Yongcheol Shin, and Richard J Smith. “Bounds Testing Approaches to the Analysis of Level Relationships.” Journal of Applied Econometrics 16, no. 3 (2001): 289–326.

Piketty, Thomas, and Emmanuel Saez. “Optimal Labor Income Taxation.” In Handbook of Public Economics, 5:391–474. Elsevier, 2013.

Ramdon Dasuki, Mohamad. “Teori Keadilan Sosial Al-Ghazali Dan John Rawls (Studi Perbandingan Dalam Konteks Politik Dan Hukum).” Tanggerang Selatan: Cinta Buku Media, 2015.

Sakni, Ahmad Soleh. “Konsep Ekonomi Islam Dalam Mengentaskan Kesenjangan Sosial: Studi Atas Wacana Filantropi Islam Dalam Syari’at Wakaf.” Jurnal Ilmu Agama: Mengkaji Doktrin, Pemikiran, Dan Fenomena Agama 14, No. 1 (2013): 151–66.

Sarea, Adel. “Zakat as a Benchmark to Evaluate Economic Growth: An Alternative Approach.” International Journal of Business and Social Science 3, no. 18 (2012).

Seibel, Hans Dieter, and Wahyu Dwi Agung. “Islamic Microfinance in Indonesia.” Working Paper, 2006.

Shahbaz, Muhammad, and Faridul Islam. “Financial Development and Income Inequality in Pakistan: An Application of ARDL Approach,” 2011.

Siddiqi, Muhammad Nejatullah. Teaching Economics in Islamic Perspective. Scientific Publishing Centre, 1996.

Uyun, Qurratul. “Zakat, Infaq, Shadaqah, Dan Wakaf Sebagai Konfigurasi Filantropi Islam.” Islamuna: Jurnal Studi Islam 2, No.2 (2015): 218–34.

Widodo, Arif. “The Role Of Integrated Islamic Commercial And Social Finance In Reducing Income Inequality In Indonesia.” Journal of Islamic Monetary Economics and Finance 5, no. 2 (2019): 263–86.

Published
2021-12-31
Section
Articles