Resource Mobilisation and Islamic Charity-Giving in Indonesia: Evidence from Low-Income Households

  • Laily Dwi ArsyiantiEmail author
  • Salina Kassim
  • Adewale Abideen Adeyemi


This paper examines low-income households’ perspective on regular charity-giving behaviour in Indonesia. Theory of social production function and the theory of planned behaviour are adopted. 1780 questionnaires are collected and analysed by using structural equation modelling. The findings suggest that informal financing institution negatively related to regular charity-giving behaviour, while indirectly related to attitude and perceived behavioural control. Meanwhile, financial education is proven to be positively related to the behaviour of giving charity regularly. It is also indirectly related through perceived behavioural control (experiences), if subjective norm (other important parties perceived by respondents) is included, but negatively related to the behaviour if subjective norm is excluded. The regular charity-giving behaviour positively affects financial ratios and satisfaction in lifestyle. These findings are useful for social-finance practitioners to change the perspective and behaviour of low-income households.


Charity-giving Low-income Households Indonesia 

JEL Classification

H41 L31 


  1. Abduh, M. (2012). Depositors’ Withdrawal Behaviour in Islamic Banking: A Case Study of Malaysia. PhD dissertation, International Islamic University Malaysia, Gombak.Google Scholar
  2. Abuza, Z. (2003). Funding Terrorism in Southeast Asia: The Financial Network of Al Qaeda and Jemaah Islamiya. Contemporary Southeast Asia: A Journal of International and Strategic Affairs, 25(2), 169–199.Google Scholar
  3. Al-Qurtubi. (1993). Tafsir Al-Qurtubi (A. Bewley, Trans.). London: Dar Al Taqwa Ltd.Google Scholar
  4. Ajzen, I. (1991). The Theory of Planned Behavior. Orgnizational Behavior and Human Decision Processes, 50(2), 179–211.Google Scholar
  5. Ajzen, I. (2002). Perceived Behavioral Control, Self-Efficacy, Locus of Control, and the Theory of Planned Behavior. Journal of Applied Social Psychology, 32(4), 665–683. Scholar
  6. Armitage, C. J., & Conner, M. (2001). Efficacy of the Theory of Planned Behaviour: A Meta-Analytic Review. British Journal of Social Psychology, 40(4), 471–499.Google Scholar
  7. Arsyianti, L. D., & Kassim, S. (2015). Regular Charity Giving of Low-Income Households in Indonesia. In 4th International Conference on Inclusive Islamic Financial Sector Development, November 17–18, Islamabad, Pakistan: International Institute of Islamic Economics (IIIE), International Islamic University Islamabad (IIUI) and IRTI-IDB.Google Scholar
  8. Ascarya, Rahmawati, S., & Tanjung, H. (2015). Designing Holistic Financial Inclusion Based on Maqasid Shari’ah. In Inaugural Annual Symposium on Islamic Finance 2015, “Islamic Finance: A Catalyst for Shared Prosperity”, Istanbul, Turkey, September 8–9.Google Scholar
  9. Beard, V. A. (2007). Household Contributions to Community Development in Indonesia. World Development, 35(4), 607–625.Google Scholar
  10. Becker, G. (1974). A Theory of Social Interactions. Journal of Political Economy, 82(6), 1063–1094.Google Scholar
  11. Beik, I. S. (2009). Analisis peranan zakat dalam mengurangi kemiskinan: studi kasus dompet dhuafah republika. Zakat and Empowering - Jurnal Pemikiran Dan Gagasan, 2, 1–11.Google Scholar
  12. Beik, I. S., & Arsyianti, L. D. (2016). Measuring zakat Impact on Poverty and Welfare Using CIBEST Model. Journal of Islamic Monetary Economics and Finance, 1(2), 141–160.Google Scholar
  13. Bekkers, R., & Wiepking, P. (2007). Generosity and Philanthropy: A Literature Review. In 35th Annual Conference of the Association for Research on Nonprofit and Voluntary Action, November 16–18, 2006 (pp. 1–68).Google Scholar
  14. Bekkers, R., & Wiepking, P. (2010). A Literature Review of Empirical Studies of Philanthropy: Eight Mechanisms that Drive Charitable Giving. Nonprofit and Voluntary Sector Quarterly, 20(10), 1–50.Google Scholar
  15. Beldad, A., Gosselt, J., Hegner, S., & Leushuis, R. (2015). Generous But Not Morally Obliged? Determinants of Dutch and American Donors’ Repeat Donation Intention (REPDON). VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(1), 442–465.Google Scholar
  16. Candland, C. D. (2001). Faith as Social Capital: Religion and Community Development in Southern Asia. Policy Sciences, 33(3/4), 355–374.Google Scholar
  17. Carter, T. S., & Carter, S. S. (2005). The Implications for Charities of Anti-terrorism Initiatives on Humanitarian Assistance for Southeast Asia. Anti-Terrorism and Charity Law Alert No. 6, January 11 (pp. 1–4).Google Scholar
  18. CGAP & Centre for Charitable Giving and Philanthropy. (2012). Philanthropy and a Better Society. London: Alliance Publishing Trust.Google Scholar
  19. Chien, Y., & Devaney, S. A. (2001). The Effects of Credit Attitude and Socioeconomic Factors on Credit Card and Installment Debt. Journal of Consumer Affairs, 35(1), 162–179.Google Scholar
  20. Cicognani, E., Mazzoni, D., Albanesi, C., & Zani, B. (2014). Sense of Community and Empowerment Among Young People: Understanding Pathways from Civic Participation to Social Well-Being. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(1), 24–44.Google Scholar
  21. Çizakça, M. (1998). Awqaf in History and Its Implications for Modern Islamic Economies. Islamic Economic Studies, 6(1), 43–70.Google Scholar
  22. de Oliveira, A. C. M., Eckel, C., & Croson, R. T. A. (2012). The Stability of Social Preferences in a Low-Income Neighborhood. Southern Economic Journal, 79(1), 15–45.Google Scholar
  23. Fernandez, J. M. (2009). From Charity to Social Investments and Social Justice: A Study of 26 Philanthropic Institutions in Indonesia. In Asian Transformations in Action, The Work of the 2006/2007 API Fellows, Bangkok: The Nippon Foundation.Google Scholar
  24. Firdaus, M., Beik, I. S., Irawan, T., & Juanda, B. (2012). Economic Estimation and Determinations of Zakat Potential in Indonesia. IRTI Working Paper Series, WP 143307. Jeddah: Islamic Research and Training Institute.Google Scholar
  25. Hair, J., Black, W., Babin, B., Anderson, R., & Tatham, R. (2006). Multivariate Data Analysis (6th ed.). Upper Saddle River: Prentice-Hall.Google Scholar
  26. Jöreskog, K. G. (1990). New Developments in LISREL: Analysis of Ordinal Variables Using Polychoric Correlations and Weighted Least Squares. Quality and Quantity, 24(4), 387–404.Google Scholar
  27. Jöreskog, K. G., & Sörbom, D. (1996). LISREL 8: User’s Reference Guide. Chicago: Scientific Software International.Google Scholar
  28. Kahf, M. (1998). Financing the Development of Awqaf Property. Seminar on Development of Awqaf, March 2–4, Kuala Lumpur, Malaysia.Google Scholar
  29. Kashif, M., Sarifuddin, S., & Hassan, A. (2015). Charity Donation: Intentions and Behaviour. Marketing Intelligence and Planning, 33(1), 90–102.Google Scholar
  30. Keese, M. (2012). Who Feels Constrained by High Debt Burdens? Subjective vs. Objective Measures of Household Debt. Journal of Economic Psychology, 33(1), 125–141.Google Scholar
  31. Lea, S. E. G., Webley, P., & Walker, C. M. (1995). Psychological Factors in Consumer Debt: Money Management, Economic Socialization, and Credit Use. Journal of Economic Psychology, 16(4), 681–701.Google Scholar
  32. Lichtenberg, J. (2009). What Is Charity? Philosophy and Public Policy Quarterly, 29(3/4), 16–20.Google Scholar
  33. Lindenberg, S. (1996). Continuities in the Theory of Social Production Functions. In H. Ganzeboom & S. Lindenberg (Eds.) Verklarende Sociologie: Opstellen voor Reinhard Wippler. Amsterdam: Thela Thesis.Google Scholar
  34. Lins, K. V., Servaes, H., & Tufano, P. (2009). What Drives Corporate Liquidity? An International Survey of Cash Holdings and Lines of Credit. Journal of Financial Economics, 98(1), 160–176.Google Scholar
  35. Livingstone, S. M., & Lunt, P. K. (1992). Predicting Personal Debt and Debt Repayment: Psychological, Social and Economic Determinants. Journal of Economic Psychology, 13(1), 111–134.Google Scholar
  36. Lusardi, A. (2008). Household Saving Behavior: The Role Financial Literacy, Information and Financial Education Programs. NBER Working Paper No. 13824. Cambridge, MA: National Bureau of Economic Research.Google Scholar
  37. Mbau, L. (2008). Perbandingan Metode Pendugaan Parameter dalam Pemodelan Persamaan Struktural [Comparison of Parameter Estimation Methods in Structural Equation Modeling]. Bogor: Bogor Agricultural University.Google Scholar
  38. McKee-Ryan, F. M., Song, Z., Kinicki, A. J., & Wanberg, C. R. (2005). Psychological and Physical Well-Being During Unemployment: A Meta-Analytic Study. Journal of Applied Psychology, 90(1), 53–76.Google Scholar
  39. Mewse, A. J., Lea, S. E. G., & Wrapson, W. (2010). First Steps Out of Debt: Attitudes and Social Identity as Predictors of Contact by Debtors with Creditors. Journal of Economic Psychology, 31(6), 1021–1034.Google Scholar
  40. Mohammad, S., & Hosseini, S. (2014). Study of Cash waqf and Its Impact on Poverty (Case Study of Iran). Atlantic Review of Economics, 2, 1–19.Google Scholar
  41. Mohammed, M. O. (2011). Economic Consumption Model Revisited: Infak Model Based on Al-Shaybani’s Level of Kasb. International Journal of Economic, Management and Accounting, 19(SI), 115–132.Google Scholar
  42. Nesbit, R., Christensen, R., Tschirhart, M., Clerkin, R., & Paarlberg, L. (2013). Philanthropic Mobility and the Influence of Duration of Donor Residency on Donation Choices. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(1), 267–287.Google Scholar
  43. Nurrachmi, R. (2012). The Implication of Cash waqf in the Society. Munich Personal RePEc Archive (August).Google Scholar
  44. Ormel, J., Lindenberg, S., Stevererink, N., & Verbrugge, L. M. (1999). Subjective Well-Being and Social Production Functions. Social Indicators Research, 46(1978), 61–90.Google Scholar
  45. Pallant, J. (2005). SPSS Survival Manual: A Step by Step Guide to Data. Crows Nest, NSW: Ligare.Google Scholar
  46. Pharoah, C., & Tanner, S. (1997). Trends in Charitable Giving. Fiscal Studies, 18(4), 427–443.Google Scholar
  47. Prouteau, L., & Sardinha, B. (2013). Volunteering and Country-Level Religiosity: Evidence from the European Union. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(1), 242–266.Google Scholar
  48. Rohima, S., Suman, A., Manzilati, A., & Ashar, K. (2013). Self Empowerment Model of the Poor (Studies in the District of Alang-Alang Lebar Palembang, Indonesia). Journal of Indonesian Economy and Business, 28(2), 188–208.Google Scholar
  49. Ross, W. J. (2003). Fundamentals of Corporate Finance (6th ed., Vol. 1). New York: McGraw-Hill.Google Scholar
  50. Sahi, S. K. (2013). Demographic and Socio-Economic Determinants of Financial Satisfaction: A Study of SEC: A Segment of Individual Investors in India. International Journal of Social Economics, 40(2), 127–150.Google Scholar
  51. Saleem, Q., & Rehman, R. U. (2011). Impacts of Liquidity Ratios on Profitability (Case of Oil and Gas Companies of Pakistan). Interdisciplinary Journal of Research in Business, 1(7), 95–98.Google Scholar
  52. Schlegelmilch, B. B., Love, A., & Diamantopoulos, A. (1997). Responses to Different Charity Appeals: The Impact of Donor Characteristics on the Amount of Donations. European Journal of Marketing, 31(8), 548–560.Google Scholar
  53. Shaikh, S., & McLarney, C. (2005). Where Does All the Money Go? An Investigation of Donation Filtration. International Journal of Sociology and Social Policy, 25(12), 81–91.Google Scholar
  54. Smith, K. A., Holmes, K., Haski-Leventhal, D., Cnaan, R. A., Handy, F., & Brudney, J. L. (2010). Motivations and Benefits of Student Volunteering: Comparing Regular, Occasional, and Non-volunteers in Five Countries. Canadian Journal of Nonprofit and Social Economy Research, 1(1), 65–81.Google Scholar
  55. Stone, B., & Maury, R. V. (2006). Indicators of Personal Financial Debt Using a Multi-disciplinary Behavioral Model. Journal of Economic Psychology, 27(4), 543–556.Google Scholar
  56. Wiepking, P. (Ed.). (2009). The State of Giving Research in Europe: Household Donations to Charitable Organizations in Twelve European Countries. Amsterdam: Amsterdam University Press.Google Scholar
  57. Wiepking, P., & Maas, I. (2009). Resources That Make You Generous: Effects of Social and Human Resources on Charitable Giving Resources That Make You Generous: Effects of Social and Human Resources on Charitable Giving. Social Forces, 87(4), 1973–1996.Google Scholar
  58. Wright, K. (2001). Generosity vs. Altruism: Philanthropy and Charity in the United States and United Kingdom. Voluntas: International Journal of Voluntary and Nonprofit Organizations, 12(4), 399–416.Google Scholar
  59. Xiao, J. J., & Wu, J. (2008). Completing Debt Management Plans in Credit Counseling: An Application of the Theory of Planned Behavior. Journal of Financial Counseling and Planning, 19(2), 29–45.Google Scholar
  60. Xiao, J. J., & Yao, R. (2014). Consumer Debt Delinquency by Family Lifecycle Categories. International Journal of Bank Marketing, 32(1), 43–59.Google Scholar
  61. Yumna, A., & Clarke, M. (2009). Integrating zakat and Islamic Charities with Microfinance Initiative in the Purpose of Poverty Alleviation in Indonesia. 8th International Conference on Islamic Economics and Finance (pp. 1–18). Doha, Qatar.Google Scholar

Copyright information

© The Author(s) 2019

Authors and Affiliations

  • Laily Dwi Arsyianti
    • 1
    Email author
  • Salina Kassim
    • 2
  • Adewale Abideen Adeyemi
    • 2
  1. 1.Bogor Agricultural UniversityBogorIndonesia
  2. 2.Institute of Islamic Banking and FinanceInternational Islamic University MalaysiaGombakMalaysia

Personalised recommendations