A proposed model forwaqffinancing public goods and mixed public goods in Malaysia

Azniza Hartini Azrai Azaimi Ambrose, Mohamed Aslam Gulam Hassan and Hanira Hanafi

International Journal of Islamic and Middle Eastern Finance and Management, 2018, vol. 11, issue 3, 395-415

Abstract: Purpose - The purpose of this paper is to formulate a model forwaqffinancing of public goods and mixed public goods in Malaysia which constitute the country’s federal government expenditures. The model is built on the basis of understanding the concept ofwaqf, learning fromwaqfinstitutions of the past and present and addressing specific Malaysianwaqfissues. Design/methodology/approach - This study uses both primary and secondary data. The primary data originate from semi-structured interviews ofwaqfacademicians from the Islamic economics and Islamic finance fields,waqfgovernment officials and private sector institutions that are involved inwaqfmanagement. The secondary data come from the Malaysian Federal Constitution, law enactments, books, e-books, bulletins, journals, conference proceedings, government reports and websites. Findings - By synthesizing the data, it is found that return from cashwaqfinvestment in unit trust can be used to finance 11 items of federal government expenditures. The overall process can be managed by Yayasan Waqaf Malaysia through a collaboration with an Islamic unit trust firm. Practical implications - This research shows howwaqfcan practically assist the Malaysian federal government in financing public goods and mixed public goods. It indirectly shows an alternative source of financing for these goods. Other economies can also learn and adapt from the model developed in this paper. Originality/value - This paper attempts to revive the function ofwaqfas a provider of public goods and mixed public goods from Islamic history. Inadvertently, this paper also introduceswaqfas a possible fiscal tool.

Keywords: Waqf; Fiscal policy; Cash waqf; Cash–waqf financing (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:eme:imefmp:imefm-01-2017-0001

DOI: 10.1108/IMEFM-01-2017-0001

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