Issue logo

Jurnal Ekonomi Malaysia

47 (2) 2013 149 – 163

Potential of Cash Waqf for Poverty Alleviation in Malaysia: A System Dynamics Approach
Potensi Wakaf Tunai bagi Pembasmian Kemiskinan di Malaysia: Pendekatan Sistem Dinamik

Research Center for Islamic Economics and Finance (EKONIS)
Faculty of Economics and Management
Universiti Kebangsaan Malaysia
43600 UKM Bangi
Selangor.

shahida@ukm.my

RAM Rating Services Berhad
Suite 20.01, Level 20
The Gardens South Tower
Mid Valley City
Lingkaran Syed Putra
59200 Kuala Lumpur.

umar@ram.com.my , umarmarzuki@gmail.com

School of Accounting
Faculty of Economics and Management
Universiti Kebangsaan Malaysia
43600 UKM Bangi
Selangor.

zainiembong@ukm.my

Abstract

Poverty alleviation has always been one of the top agendas in any country, including Malaysia. This is evidenced from the spending of the government for the purpose of uplifting the income of the poor. The objective of this paper is therefore to explore alternative tool in eradicating poverty, specifically in Malaysia, by exploring the role of cash waqf. This paper examines the potential impact of cash waqf on the Malaysian economy. Cash waqf is specifically analysed in this paper as an alternative instrument that can improve the overall social welfare system and reduce poverty rate; and at the same time, lessen the burden of the government. To analyse the potential of cash waqf model in a dynamic system, this study employs system dynamics methodology. The feedback nature of the whole system is modelled and outputs in the form of figures are derived from simulations. With two different cases (i.e. set of assumptions) under study, the model simulations show that cash waqf is significant in alleviating poverty by up to 50 per cent for both cases. Apart from that, government spending can also be significantly reduced. Total savings can go over RM13 billion or an average of RM433 million a year over 30 years. Given the findings, the government can take into account the potential of implementing cash waqf in Malaysia.

Keywords

Cash waqf; microfinance; poverty alleviation; system dynamics

Author’s Acknowledgement

This study is partly funded by research grant UKMGUP-2011-009. The authors wish to acknowledge Universiti Kebangsaan Malaysia for this financial assistance.

No. of views: 423
View Full Text

Bibliography

Export Bibliography

Shahimi, , Mohd Marzuki, , & Embong, (2013). Potential of Cash Waqf for Poverty Alleviation in Malaysia: A System Dynamics Approach. Jurnal Ekonomi Malaysia, 47(2), 149–163.

@article{shahimi2013potential,
  title={Potential of Cash Waqf for Poverty Alleviation in Malaysia: A System Dynamics Approach},
  author={Shahimi, Shahida and Mohd Marzuki, Mohd Umar and Embong, Zaini},
  journal={Jurnal Ekonomi Malaysia},
  volume={47},
  number={2},
  pages={149—163},
 

year={2013},
}

Receive updates when new articles are published.