ASSESSING THE VIABILITY OF MUZA’RAH AGRO FINANCING AS A SUSTAINABLE SOLUTION FOR SMALL-SCALE FARMERS: A CASE STUDY FROM PAKISTAN

Sahibzada Muhammad Hamza () and Nasim Shah Shirazi ()
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Sahibzada Muhammad Hamza: Hamad Bin Khalifa University, Qatar
Nasim Shah Shirazi: Hamad Bin Khalifa University, Qatar

Journal of Islamic Monetary Economics and Finance, 2024, vol. 10, issue 2, 277-300

Abstract: The interplay between the Muza’rah (Sharecropper) agro-financing structure and its impact on rural income and rural poverty alleviation constitutes a multifaceted phenomenon. In this study, we seek to understand of the relation between Muza’rah agro-financing structure and rural income and the mediating role of national agricultural output for the case of Pakistan, a predominantly Muslim country characterized by a well-established Islamic banking and finance infrastructure. Using data from the Pakistan Social and Living Standard Survey (PSLM), the research reveals that the rural per capita income is significantly and negatively related to the Muza’rah agro-financing structure, which is further strengthened by the level of the national agricultural output. The finding underscores the importance of nuanced understanding for policymakers and practitioners engaged in poverty alleviation efforts, emphasizing the need to consider contextual variables and a nation's developmental status when designing interventions to improve rural livelihoods.

Keywords: Muza’rah agro financing; Rural poverty; National agriculture output (search for similar items in EconPapers)
JEL-codes: I30 Q14 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:idn:jimfjn:v:10:y:2024:i:2c:p:277-300

DOI: 10.21098/jimf.v10i2.1729

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