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Jurnal Ekonomi Malaysia

57 (1) 2023 99 – 112

Human Development Index from the Islamic Perspective: Roles of Taxation, Zakah, and Health and Education Expenditures

Faculty of Economics and Business
Alma Ata University
Yogyakarta 55011, INDONESIA.

zidny@almaata.ac.id

Faculty of Sharia and Law
State Islamic University Sunan Kalijaga
Yogyakarta 42311, INDONESIA.

makhrus@uin-suka.ac.id

Faculty of Islamic Economics and Business
State Islamic University Sunan Kalijaga
Yogyakarta 42311, INDONESIA.

abd.qoyum@uin-suka.ac.id

Abstract

This study analyzes the relationship between taxation, zakah, and health and education expenditure, and the Islamic Human Development Index (I-HDI). It further examines the relationship between these factors and the Human Development Index (HDI). We calculate I-HDI based on maqāṣid al-sharī’ah theory by combining material and non-material aspects and then compare it with HDI. The indicators used in the I-HDI calculation are based on the objectives that reflect a comprehensive human development. Employing the dynamic panel regression two-step Generalized Method of Moments on data from 34 provinces in Indonesia, this study finds a significant difference between the results of the HDI and I-HDI analyses. This study reveals that economic growth, health expenditure, and zakah improve HDI and I-HDI. Although educational expenditure improves I-HDI, it also has a negative effect on HDI. This research suggests that when formulating budget policies, the government should focus not only on material elements but also on non-material elements that are reflected in the I-HDI model.

Keywords

education expenditure; Health expenditure; human development index; Islamic human development; taxation; zakah

JEL Codes

01, E6, O4
http://dx.doi.org/10.17576/JEM-2023-5701-08
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Hasbi, M. Z. N., Munajat, M., & Qoyum, A. (2023). Human Development Index from the Islamic Perspective: Roles of Taxation, Zakah, and Health and Education Expenditures. Jurnal Ekonomi Malaysia, 57(1), 99–112. http://dx.doi.org/10.17576/JEM-2023-5701-08

@article{,
  title={Human Development Index from the Islamic Perspective: Roles of Taxation, Zakah, and Health and Education Expenditures},
  author={Hasbi, M. Zidny Nafi’ and Munajat, Makhrus and Qoyum, Abdul},
  journal={Jurnal Ekonomi Malaysia},
  volume={57},
  number={1},
  pages={99—112},
 

year={2023},
}

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