The Effect of Zakat toward the Macroeconomic Factors in Malaysia

Alif, Abd Aziz and Ahmad Syubaili, Mohamed and Suzila, Mohamed Yusof and Nurul Syuhada, Zaidi (2019) The Effect of Zakat toward the Macroeconomic Factors in Malaysia. International Journal of Academic Research in Business and Social Sciences, 9 (7). pp. 571-589. ISSN 2222-6990

PDF Aziz, A. A., Mohamed, A. S., Yusof, S. M., & Zaidi, N. S. (2019). The Effect of Zakat toward the.pdf Download (911kB)

Abstract

Zakat is a determination to purify society from diseases of poverty without distinction of race, ethnicity, and class. Therefore, objective of this study is to investigate the effect of zakat collection on the macroeconomic factors in Malaysia. The macroeconomics factors are poverty, gross domestic product and total unemployment. The time-series data has been used in this study. The data for this study is collected from the world bank data, Pusat Pungutan Zakat-MAIWP. The test that has been used for this study are correlation analysis, ordinary least square, normality test, heteroscedasticity test, serial correlation test, Granger causality test and the Hedrick – Prescott test. The data were analyzed and run by using the statistical software which is Eviews 10. Three regression model has been constructed to the achieved objective for this study. In this study, the dependent variable is poverty (Headcount Index), gross domestic product (GDP) and total unemployment and the independent variable is the collection of zakat in Malaysia. The result shows there is an inverse relationship between zakat and poverty. Meanwhile, there is a positive relationship between zakat, GDP, and the unemployment rate. The policymakers and government of Malaysia could use this study to increase the awareness towards the zakat to help Malaysia to improve the system of zakat and make zakat as the main income factor of Malaysia for the futures.

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