Poverty alleviation by Zakah in a transitional economy: a small business entrepreneurial framework

Nazamul Hoque,Mohammad Aktaruzzaman Khan,Kazi Deen Mohammad

doi:10.1186/s40497-015-0025-8

Nazamul Hoque, Mohammad Aktaruzzaman Khan + Show 1 more

Open Access

https://doi.org/10.1186/s40497-015-0025-8

Copy DOI

Abstract

Abstract Around 3 billion people are living in poverty of which 35 % are from Muslim World (World Bank 2010). In this case, global Muslim community has prime role to address the injustice of global poverty through zakah as an Islamic faith-based institution and having potential annual fund of $139.32 billion in Muslim world. This study designed an explanatory sequential mixed method. For qualitative data, 17 managers were interviewed and 85 zakah recipients were purposively surveyed (disproportionate sampling) for quantitative purpose between August 1 and December 30, 2013. The results indicate that zakah has significant bearing on the conditions of zakah recipients and lie the foundation of developing small business entrepreneurship by mobilizing zakah as seed money (investment) and not as spent money (consumption). A five-phased process model underpinned by two well-grounded theories: Becker’s human capital theory and Kirkpatrick’s training evaluation taxonomy has been proposed for developing entrepreneurship having universal application. The model’s implications for alleviating poverty by governments, zakah management institutions, and policy makers also discussed in the paper.

Highlights

The World Bank estimates that approximately 3 billion people are living in poverty and 46 million more people will come under the income level of US$1.25 a day due to the recent global economic meltdown and slow economic growth rates (Ali and Hatta 2014; World Bank 2010)
The results indicate that zakah fund is not used for productive purposes; as a result, zakah is not uprooting the poverty from the society as it could be
How zakah can be used as seed money rather than spent money is a research question? this study has developed the following process model (Fig. 2) for developing small entrepreneurship by mobilizing zakah

Summary

Introduction

The World Bank estimates that approximately 3 billion people are living in poverty and 46 million more people will come under the income level of US$1.25 a day due to the recent global economic meltdown and slow economic growth rates (Ali and Hatta 2014; World Bank 2010). Poverty has become one of the severe problems for many transitional economies like Bangladesh. Poverty is considered as a severe disease in any country (Affandi and Astuti 2013) which may exist amidst plenty even in those countries that have been doing better (Ariffin 1994). Poverty is the state of one who lacks a usual or socially acceptable amount of money or material possessions (Encyclopedia Britannica). Poverty is a situation in which people lack necessary income to satisfy essential needs such as food, clothing, energy and shelter. Absolute poverty (extreme poverty) refers to the deprivation of basic human needs, which

Objectives

Methods

Results

Discussion

Conclusion