Poverty Measurement by Islamic Institutions

Authors: Mohamed Saladin Abdul Rasool, Arifin Md Salleh, Mohd Fauzi Mohd Harun

Abstract:

Islamic institutions in Malaysia play a variety of socioeconomic roles such as poverty alleviation. To perform this role, these institutions face a major task in identifying the poverty group. Most of these institutions measure and operationalize poverty from the monetary perspective using variables such as income, expenditure or consumption. In practice, most Islamic institutions in Malaysia use the monetary approach in measuring poverty through the conventional Poverty Line Income (PLI) method and recently, the had al kifayah (HAK) method using total necessities of a household from an Islamic perspective. The objective of this paper is to present the PLI and also the HAK method. This micro-data study would highlight the similarities and differences of both the methods.A survey aided by a structured questionnaire was carried out on 260 selected head of households in the state of Selangor. The paper highlights several demographic factors that are associated with the three monetary indicators in the study, namely income, PLI and HAK. In addition, the study found that these monetary variables are significantly related with each other.

Keywords: Poverty line, multidimensional, necessities, monetary

Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1085082

References:

[1] D. Narayanan and R. Patel. Voices of the poor. Can anyone hear us?. Oxford: Oxford University Press. 2000.
[2] C. R. Laderchi, Ruhi Saith and F. Steward. Does it matter that we don-t agree on the definition of poverty. QEH Paper Series 17. 2003.
[3] Mohd. Fauzi Harun and Ahmad Fauzee Abdullah Kemiskinan Mengikut Teori Konvensional dan Perspektif Islam. UPENA.2007.
[4] Mohd. Fauzi Harun and Nur Aini Idris. Pembangunan Masyarakat Orang Asli Dilema Kemiskinan dan Terpinggir. UPENA. 2009.
[5] M. L.Aselin and A. Dauphin, Poverty Measurement : A Conceptual Framework. Canadian Centre for International Studies and Cooperation. 2001.
[6] M. Ravallion, Poverty lines in theory and practice. LMS Working Paper, 133.The World Bank. 1998.
[7] Yusuf Al-Qardawi. Fiqh Al-Zakah. Translated by Monzer Kah. Scientific Publishing Centre. King Abdul Aziz Uiversity. Jeddah. 1980.
[8] United Nations Development Programme. Malaysia: Measuring and Monitoring Poverty and Equality. 2007.
[9] JAWHAR. Manual Pengurusan Zakat. Jabatan Perdana Menteri Malaysia. 2007.
[10] A.K. Sen, Development as Freedom (DAF). Oxford. Oxford University Press.1977.
[11] A.K. Sen, The standard of living: lecture ii, lives and capabilities in G. Hawthorn (ed.) The Standard of Living, The Tanner Lectures (clare Hall), Cambridge.1987.
[12] A.K. Sen, A. K. Inequality Reaxamined. Harvard University Press, Cambridge, MA. 1992.
[13] U. Wagle, Multidimensional Poverty Measurement with economic wellbeing, capability and social inclusion : A Case from Katmandu, Nepal. Journal of Human Development, Vol. no.6, November 2005.
[14] U. Wagle. Poverty in Katmandu : What do subjective and objective economic welfare concepts suggest? Journal of Economic Inequality Vol 5. No.1. 2007.
[15] U. Waggle. Mutidimensional Poverty: An alternative measurement approach for the United States?. Social Science Research Volume 37, Issue 2 .2008.
[16] S. Alkire and E.M. Santos. Acute Multidimensional Poverty: A New Index for Developing Countries. OPHI Working Paper No. 38. Oxford University Press. 2010.
[17] S. Alkire, and J. Foster. Counting and Multidimensional Poverty Measurement. Journal of Public Economics Volume 95 Issues 7-8. August 11. 2011.
[18] B. Nolan, and C.T. Whelan. Using non-monetary deprivation indicators to analyse poverty and social exclusion in rich countries. Lesson from Europe. Journal of Policy analysis and Management. 2010.
[19] Rosbi A. Rahman and Sanep Ahmad. Pengukuran keberkesanan Agiham Zakat : Perspektif maqasid al-syariah. Proceedings of Seventh International Conference The Tawhidi Epistemologi : Zakat and Waqf fund. 6th -7th January. Institut Islam Hadhari, UKM Bangi, Malaysia. 2010.
[20] Islamic Relief Worldwide. Definitions of Poverty. Birmingham. UK.2008