ELIMINATION OF POVERTY: CHALLENGES AND ISLAMIC STRATEGIES

Abstract

Poverty is a complex phenomenon, a consequence of lack of growth and inequality. Effective policies require technical and empirical understanding of poverty that is combined with efficient institutions and a supportive system of social values. We focus on four basic tenants of the Islamic ethical system and treat the Islamic ethos as an ideal, through which socioeconomic policies dealing with poverty elimination are assessed. Islam views society as a unified equity in which individual freedom and human dignity is supreme although subject to the axiom of responsibility. These ethical tenants indicate that policies should not develop ‘dependency’ or amoral activities. Policies should not lead to the institutionalization of poverty. Policies based on transfers that do not lift the poor from their dependency status should not be adopted except in cases where such shift is not feasible. Based on the conceptual and empirical evidence, the paper concludes that Islamic ethics support a poverty-alleviation strategy based on the principle of promoting economic growth with productive equity.