Multidimensional poverty measurement from islamic perspectives: a survey of the literature

It is widely accepted that poverty is complex and multidimensional in nature. The narrow approach in measuring poverty based on a monetary approach fails to incorporate other important factors such as access to education, access to healthcare, and type of dwelling; some other relevant factors that could impact quality of life is being ignored. Islam is profoundly concerned about poverty and as a comprehensive source of references, Islam has specific guidelines in this matter that cover all aspects of life. At present, Islamic institutions such as zakat are applying the monetary approach in identifying the poor and destitute. Hence, a robust poverty measurement that covers the other non-monetary aspects should be an area of concern among the policy makers and financial institutions such as zakat to capture the targeted group more accurately. Poverty measurement should also embrace the principle of Maqasid al-Shari'ah, which is the central principle of Shari'ah law. This paper outlines the trends in developing the poverty socio-economic development index based on the inclusion of Maqasid al-Shari'ah. Numerous empirical works pertaining to poverty measurement from a multidimensional lens and integration of the Maqasid al-Shari'ah have been observed. Thus, the paper highlights some important gaps observed from past studies. This study emphasizes the need for more objective variables and microlevel data that is more frequently monitored since dependence on secondary data may limit the choices of dimensions and indicators needed to be incorporated in the Islamic poverty index.