Mainstream economic policies often prioritize short-term goals, such as inflation control and GDP growth, over addressing the root causes of unemployment. This short-sighted approach can lead to unemployment persistence, even during periods of apparent economic growth. By contrast, behavioural economics urges policymakers to adopt long-term and holistic strategies that prioritize social welfare and sustainable job creation, offering a more nuanced and comprehensive perspective on addressing unemployment.
Zakat as an Instrument of Poverty Reduction in Indonesia
Authors argue that theoretically, Zakat can promote the higher objectives of a country’s economy. The imposition of Zakat on the assets and business of Muzakki provided the conditions of the haul and nisab have been met encourages the productivity of Muzakki. It urges them to be productive and prudent in their investments. It triggers an increase in labour supply and investments. Zakat transfer leads to higher consumption and spending which is good for the businesses and economy.
Zakat and Protection of Poor from Inflation
Zakat helps poor to meet their essential needs even in an inflationary environment. Contrarily, higher indirect taxation results in inflation. However, Ushr, which is a form of Zakat would produce results otherwise by helping poor and needy people who are affected the most from inflation.
The World Economy and Islamic Economics in the Time of COVID-19
This paper presents statistics to illustrate the economic effects of COVID-19 in the global economy. Poverty and unemployment in the informal sector of developing economies is on the rise. On the other hand, developed economies have also seen economic contraction. Capital markets have seen sharp decline in the early part of 2020. However, the author notes that Islamic equity portfolios were less affected. This finding is discovered in other empirical studies as well where Islamic portfolios are found to perform relatively better in economic and market downturns.
Islamic Banking and Conventional Banking During COVID-19 Crisis
If the virus had been growing at a linear rate, it would not have been that much dangerous. It is the exponential increase in the Corona Virus spread which makes it become uncontrollable and create havoc in the society. Compound interest in the financial system is such a Corona Virus. Interest accrued but unpaid increases interest in the future periods ahead at an exponential rate.
Islamic Economics Project 