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Article
Publication date: 19 June 2019

Rahmatina Awaliah Kasri and Untung Handayani Ramli

This study aims to determine the factors that influence the decisions of Muslims in Indonesia, the world’s largest Muslim country and recently acknowledged as the world’s…

Abstract

Purpose

This study aims to determine the factors that influence the decisions of Muslims in Indonesia, the world’s largest Muslim country and recently acknowledged as the world’s most generous country (CAF, 2017), to donate money through mosques.

Design/methodology/approach

This study uses the extended theory of planned behaviour to determine the above-mentioned factors. Primary data were obtained via a survey that generated 235 responses from respondents in Depok City, Indonesia. The primary data were analysed using descriptive statistics and structural equation modelling.

Findings

The findings suggest that stronger religious beliefs, a greater trust in mosques, ease of making donations, the influence of significant others and good past experiences of donating to mosques influence donations to mosques in Depok. Thus, most of the hypotheses tested are accepted. However, the relationships between attitude and intention and moral norms and intention are found to be insignificant, which the authors presume to be related to the collective culture of Muslims in Indonesia.

Practical implications

The managements of mosques need to build, maintain and increase the trust of their congregations in the institution. They also need to improve the services they provide to their congregations and endorse charitable activities through influential persons such as ulama and celebrities. Together with the other stakeholders, such as the government and Muslim communities, they should also improve access to donate and increase the impacts of the donations.

Originality/value

This study offers fresh and current insights into voluntary giving behaviour to a specific religious institution/channel in the world’s largest Muslim country, which has also recently been acknowledged as the world’s most generous country.

Article
Publication date: 20 June 2016

Yasushi Suzuki and Mohammad Dulal Miah

This paper argues how Islamic altruism and reciprocity can enhance or drain the supply of Islamic equity finance. The paper also analyzes the feasibility of Islamic equity…

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Abstract

Purpose

This paper argues how Islamic altruism and reciprocity can enhance or drain the supply of Islamic equity finance. The paper also analyzes the feasibility of Islamic equity finance through the lens of new institutional economics (NIE) and transaction cost economics (TCE).

Design/methodology/approach

One of the salient contributions by NIE is to support the proposition that effective contracting depends greatly on institutions in terms of “rules that constrain economic behavior”, including informal or intangible institutions, such as religion, culture and customary practices. This paper draws on the theoretical contributions of the NIE and TCE and applies some of these contributions to an analysis of general altruism and reciprocity in Islamic economies.

Findings

It is said that solutions based on the Islamic injunctions (collectively termed as spiritual quotient) could serve to mitigate agency risks. However, in theory, the Muslim principal (particularly fund providers) is exposed to higher agency risk unless appropriate rules of protecting the right of the principal (or of punishing the agent when its opportunistic behavior is revealed) are devised, because the Muslim fund providers have the divine obligation to share risks in enterprise under the profit-loss sharing (PLS) scheme as well as to share a portion of income with the poor or those entrepreneurs who face difficulties in fund-raising.

Originality/value

Many scholars refer to the lack of the “formal” institutions that hinder the sound development of Islamic venture capital (VC). This paper contributes to shedding an analytical light on the unique feature of the Muslims’ “informal” constraints which make them hesitate to invest in Islamic VC. To develop the Islamic VC market, this paper provides a theoretical background to suggest how important it would be for the national financial system to devise some tangible provisions by installing enterprise-friendly regulations as well as adequate incentive and protection mechanisms consistent with Islamic principles.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 9 no. 2
Type: Research Article
ISSN: 1753-8394

Keywords

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