Economica: Jurnal Ekomomi Islam Vol 16.
No 2 .
: 267Ae291 DOI: 10.
21580/economica.
Beyond Religiosity: How Social Capital Drives Institutional Zakat Payment Preferences in Indonesia - A Behavioural Economics Analysis Royyan Ramdhani Djayusman 1*.
Adi Rahmannur Ibnu 2.
Setiawan bin Lahuri 1.
Ismail Jalili 3 Universitas Darussalam Gontor.
Ponorogo.
Indonesia University of Birmingham.
Birmingham.
United Kingdom Universitas Islam Negeri Fatmawati Soekarno Bengkulu.
Bengkulu.
Indonesia Abstract Notwithstanding the fact that Indonesia has the worldAos largest Muslim population, zakat collection through formal institutions is substantially below expectations.
light of this shortfall, this study investigates the interplay between religiosity and social capital on individual preferences for zakat payments and the proportion allocated to official zakat agencies, with the overarching aim of contextualizing the fiqh zakat framework in contemporary Indonesia.
Drawing upon the data from a nationwide survey of 794 respondents, the empirical analysis employs Linear Probability Model (LPM) and Poisson Pseudo Maximum Likelihood (PPML) regression techniques to examine the determinants of zakat payment Findings reveal that social capital significantly increases both the likelihood of choosing zakat institutions and the portion of zakat paid through them.
contrast, religiosity shows a weaker direct effect on institutional zakat payment.
Taken together, these results highlight the pivotal role of social networks and trust in enhancing institutional zakat collection.
Therefore, the study advocates for a strategic reform of fiqh zakat practices that integrate social capital strategies to reinforce religiosity and improve zakat compliance through formal channels.
Keywords:
Fiqh Zakat.
Religiosity.
Social Capital.
Zakat.
Zakat Organisation Citation (APA):
Djayusman.
Ibnu.
Lahuri.
bin, & Jalili.
Beyond Religiosity: How Social Capital Drives Institutional Zakat Payment Preferences in Indonesia - A Behavioural Economics Analysis.
Economica:
Jurnal Ekonomi Islam, 16.
, 267Ae https://doi.
org/10.
21580/econo Submitted: 14 May 2025 Revised: 15 Sep 2025 Accepted: 26 Sep 2025 Published: 03 Oct 2025 Copyright: A 2025 by Economica:
Jurnal Ekomomi Islam Submitted for possible open access publication under the terms and conditions of the Creative Commons AttributionNonCommercial-ShareAlike 4.
International License.
_______________
Corresponding Author.
Email: royyan@unida.
Economica: Jurnal Ekomomi Islam p-ISSN: 2085-9325.
e-ISSN: 2541-4666 Vol 16.
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Introduction As a cornerstone of Islamic social finance.
Zakat is a fundamental pillar of Islam and a mandatory form of financial worship intended to promote social welfare.
Notwithstanding its religious significance, a profound gap persists between the potential and actual collection of zakat in Indonesia, the worldAos largest Muslimmajority country.
To illustrate this disparity, while the estimated zakat potential reached IDR 217 trillion in 2010 (Firdaus et al.
, 2.
, only IDR 5.
6 trillion was collected through formal institutions (Adinugroho et al.
, 2.
This noticeable difference consequently underscores critical inefficiencies in zakat mobilisation and raises urgent questions about the behavioural factors that influence whether Muslims channel their zakat through institutional or non-institutional means.
A prevailing explanation for this gap points to the historical and jurisprudential .
ambiguity in Indonesia regarding zakat collection, which effectively legitimises both direct payment to recipients and payment through authorised institutions (Fauzia, 2.
While existing scholarship has extensively explored fiqhoriented topics such as zakat management (Shahmi et al.
, 2.
, itAos potential key role in dealing with social and environmental issues (Ali et al.
, 2021.
Shahmi et al.
, and calculative models (Asfarina et al.
, 2019.
Zaenal et al.
, 2.
as well as behavioural studies on giving motives (Kasri, 2013.
Ridlwan & Sukmana, 2.
, a significant lacuna remains.
Furthermore, previous behavioural research, while offering valuable insights t, has been constrained by limited sample sizes, often under 300 respondents (Kasri, 2013.
Kasri & Ramli, 2.
, and has not comprehensively investigated the interactive roles of religiosity and social capital in shaping not just the preference for institutional payment, but also the critical decision of the portion of zakat paid to them.
Third, the recent view of the literature on this topic moves beyond examining religiosity and social capital in isolation.
Indeed, its core theoretical contribution lies in empirically testing the interaction between these two factors within the context of institutional preference.
This study posits that in an environment of fiqh ambiguity, social capital, particularly institutional trust and community norms, may act as a crucial mechanism that amplifies or complements religious obligation in driving formal zakat compliance.
By contextualizing these empirical findings within the historical framework of fiqh zakat, this research aims to provide a clear understanding of the behavioral dynamics that inhibit institutional zakat collection in Indonesia.
Consequently, the 268 | Vol 16.
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study offers evidence-based strategies for revitalising zakat jurisprudence and practice, ultimately seeking to enhance the role of zakat in IndonesiaAos Islamic social finance ecosystem.
Responding to the above elaboration, the subsequent section reviews the literature on religiosity, social capital, and the history of fiqh zakat in Indonesia.
Subsequently, the following section outlines the research method, hypotheses, empirical specification, and variables and data.
This is followed by a section presenting the empirical and robustness results.
Following this, a section presents the findings, and the final section concludes by highlighting the policy implications and limitations.
Literature Review Religiosity Empirical research elaborated that religiosity can significantly drive individual Previous studies highlight the positive and significant influence of religiosity on religious giving, showing that individuals with higher religiosity levels are more inclined towards religious donations (Brooks, 2005.
Choi & DiNitto, 2012.
Clerkin et al.
, 2013.
Forbes & Zampelli, 1997.
Glanville et al.
, 2016.
Herzog & Yang.
Vaidyanathan et al.
, 2011.
Warner et al.
, 2.
These studies suggest a strong correlation between religiosity and the likelihood of donating to religious causes, indicating that higher levels of religiosity often result in more frequent and substantial donations to religious causes.
Moreover, religiosity plays a crucial role in shaping giving behaviours beyond just donation decisions.
Studies reveal a strong correlation between religiosity and giving behaviours, including donations to mosques (Kasri & Ramli, 2.
, beggars (Erlandsson et al.
, 2.
, and others, such as friends and family (Einolf, 2.
These findings indicate that highly religious individuals are more inclined to donate to religious organisations .
, mosque.
and those in need.
This preference suggests that religiosity not only motivates the act of giving but also influences the choice of recipients, emphasising support for religious causes and vulnerable individuals.
Social Capital The extant methodological analysis consistently demonstrates the significant and positive impacts of social capital, particularly social trust and community embeddedness, on religious givin (Abdul-Jabbar & Bin-Nashwan, 2022.
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DiNitto, 2012.
Forbes & Zampelli, 2013.
Herzog & Yang, 2018.
Kasri & Ramli, 2019.
Kasri & Yuniar, 2021.
Sadallah & Abdul-Jabbar, 2.
This study proposes that social capital influences zakat behaviour through two interconnected mechanisms:
the enforcement of social norms, and .
the cultivation of institutional trust.
First, social capital generates and strengthens norms through social networks (Herzog & Yang, 2018.
Kasri & Ramli, 2.
Contextualizing this idea, in closely bonded communities, there is a strong social expectation to fulfil religious duties, such as paying zakat.
adherence is promoted, and failing to comply may lead to social This transforms zakat from a private transaction into a reinforced community norm, thereby enhancing participation.
Second, these norms and networks directly build trust in zakat institutions.
As Abdul-Jabbar & Bin-Nashwan .
found that positive perceptions of institutions lead to increased compliance.
This is because social capital fosters a belief that the institution is legitimate and will distribute funds effectively (Sadallah & Abdul-Jabbar, 2.
, reducing uncertainty for the payer.
Therefore, in essence, social capital does not merely correlate with zakat payment.
it actively enables it by creating a social environment where giving is expected, trusted, and facilitated.
Fiqh Zakat Practice in Indonesia The historical trajectory zakat practice in Indonesia is deeply rooted, originating during the Islamic kingdoms, where the state oversaw zakat collection, a precedent exemplified by the 13th-century Islamic kingdom of Samudra Pasai (Fauzia, 2.
In this era, zakat was centralized under government authority and treated as a critical state function and financial resource.
However, zakat management by the state deteriorated during colonial rule.
The colonial government separated religious and governmental affairs, delegating zakat management to religious leaders while retaining control over land taxes (Fauzia, 2.
This shift undermined the centrality of zakat as a state duty and financial resource, consequently weakening the overall effectiveness of zakat collection.
Zakat remained notably absent from government priorities during Indonesia's early independence, as clearly noted during President Soekarno's administration, which excluded zakat from government prioritie (Nieuwenhuijze, 1.
Until the second president.
General Soeharto, took office, the government began its involvement by issuing a presidential decree to organise zakat collection (Ariff.
This recognition led to the establishment of provincial-level zakat organisations, such as BAZIS in Jakarta, and later in other provinces.
The zakat 270 | Vol 16.
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management regulation was further strengthened with the Zakat Law No.
38/1999,
acknowledging both government and non-government zakat organisations, and later with Zakat Law No.
23/2011, which required non-government organisations to work under BAZNAS (Ariff, 1.
However, centralised zakat management under BAZNAS was suspended following appeals from non-government The development of zakat regulation continued until 2011, when the new Zakat Law No.
23/2011 was issued.
This law requires non-government zakat organisations, such as LAZ, to work under the coordination of BAZNAS .
reviously called BAZIS), the primary zakat organisation at the national level.
As a result of this legislation, every LAZ must regularly report their financial statements to BAZNAS and obtain legal permission from government authorities to establish new zakat organisations at the provincial or district levels.
However, some influential nongovernment zakat organisations1, led by Dompet Dhuafa, the largest charity organisation, appealed this law through the Constitutional Court of Indonesia.
Finally, the court accepted some of their appeals, allowing BAZNAS and LAZ to operate the zakat collection in Indonesia.
Consequently, centralized zakat management under BAZNAS has been suspended.
Methods To rigorously address the aforementioned research gaps, this study conducted an empirical investigation to capture the behaviours of zakat payers.
In doing so, it examined the impact of religiosity and social capital on zakat payment preferences and portions among zakat payers using LPM and PPML models.
The use of the LPM and PPML in this study is due to the interpretability and robustness considerations provided by interpretability and stastitical robust statistical considetation provided both models.
LPM was chosen over Logit and Probit models primarily for its ease of interpretation, especially in estimating marginal effects directly without requiring post-estimation transformation (Angrist & Pischke, 2009.
Wooldridge, 2.
For modelling the portion of zakat paid to institutions.
PPML was selected due to its ability to handle non-negative, skewed data with excess zeros, which is common in donation behaviour.
Unlike Tobit or fractional response models.
PPML is robust to heteroskedasticity and does not require distributional assumptions about the error
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1 Such as Dompet Dhuafa.
Rumah Zakat.
Yatim Mandiri.
Portal Infaq.
Yayasan Dana Sosial Al-Falah.
LPPZISWAF Harum.
Harapan Dhuafa Banten.
Lembaga Manajemen Infaq, dan YPI Bina Madani Mojokerto.
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term (Pinto et al.
, 2.
Moreover.
PPML performs well even when the dependent variable is not strictly count-based, as long as it is non-negative, making it ideal for modelling proportion data in this context.
Together.
LPM and PPML offer a balance of statistical rigour and practical clarity, aligning with best practices in applied Research Hypothesis Executing this methodological analysis it highlights the significance of religiosity in affecting the behaviour of religious donations (Choi & DiNitto, 2012.
Clerkin et al.
Forbes & Zampelli, 1997.
Glanville et al.
, 2016.
Herzog & Yang, 2018.
Kasri & Ramli, 2019.
Vaidyanathan et al.
, 2.
This study makes the following hypothesis:
Hypothesis 1: Religiosity positively influences the institutional preferences and portions donated.
This hypothesis suggests that individuals with higher levels of religiosity .
religious commitment and practice, and religious belie.
are more likely to engage in religious giving activities, especially donations to charity organisations.
This research expands upon current studies to examine the influence of religiosity on religious donations within the specific framework of this paper, which addresses giving preferences (Einolf, 2013.
Erlandsson et al.
, 2019.
Kasri & Ramli, 2.
This theory enhances existing research by emphasising the significance of social capital, , social trust and norms, in shaping religious donation behaviours (Abdul-Jabbar & Bin-Nashwan, 2022.
Choi & DiNitto, 2012.
Forbes & Zampelli, 1997.
Herzog & Yang, 2018.
Kasri & Ramli, 2019.
Kasri & Yuniar, 2021.
Sadallah & Abdul-Jabbar.
Therefore, this paper proposes the subsequent hypothesis:
Hypothesis 2: Social capital positively influences the institutional preferences and portions donated.
In alignment with established theories of prosocial behaviour, this hypothesis suggests that individuals with elevated social capital are more likely to participate in religious giving.
This paper seeks to examine the influence of social capital on charitable behaviours, integrating prior research within the unique setting of this Social capital, operationalized by social trust and norms, is related to individualsAo social ties.
Similarly, social involvement is essential in inspiring individuals to nurture and distribute resources among others.
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(Putnam, 2.
Furthermore, trustworthy relationships within communities enhance the dissemination of information and the consolidation of resources (Choi & DiNitto, 2.
Consequently, social capital converts zakat from a private transaction into a strengthened community norm, thereby expanding participation.
Moreover, social norms and networks play a direct and positive role in fostering trust in zakat institutions, as empirical evidence suggests Abdul-Jabbar & BinNashwan .
found that favourable perceptions of institutions lead to increased Hence, social capital fosters a perception of institutional legitimacy and efficient fund distribution (Sadallah & Abdul-Jabbar, 2.
, thereby reducing uncertainty for the payer.
The interactions between outcome and explanatory variables, including the hypotheses examined in this study, are presented in the research framework in Figure 1.
Figure 1.
Research Framework Empirical Specification This structural analysis discusses an econometric model that build upon in the research conducted by Forbes & Zampelli .
, which examined religious donations as a function of socioeconomic and demographic attributes .
, tax deduction, tithe, income, marital status, household size, age and educatio.
, religious Economica: Jurnal Ekonomi Islam Vol 16.
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, commitment, religious attendanc.
, along with attitudes .
secularism, trust, giving back to community and helping other.
in shaping householdsAo monthly religious contribution.
Drawing inspiration from this framework, this study formulates an economic model of charity giving by deriving an equation that represents philanthropic contributions.
, giving preference and portion donated to charity organisation.
is a function of donorsAo religiosity, social capital, income and gender, including their education and living areas as controls.
Yet, the analysis presented in this study departs from its econometric model (Forbes & Zampelli, 1.
, as this paper focuses on examining giving behaviours at the individual level.
Thus, the equation is written as:
ycyeO = yuya yuya ycyeO yuya yae yuyeAyeO yyayeO , .
where ya% denotes the different measures giving preference and the portion donated by individual ycn.
Additionally, ycI% and ycI, respectively, denote religiosity and social capital.
Furthermore, the vector of controls ycs% incorporates various sociodemographic indicators, such as income, gender, education, and region.
accordance with Hypothesis 1, the anticipated coefficient of religiosity is projected to be positive.
Therefore, this investigation sets ya& : yu7' = 0, ya( : yu7' O 0.
This test aims to investigate whether evidence exists to support the hypothesis that the level of religiosity influences donation preferences and the share of donations given to charity organisations .
, zakat institution.
Correspondingly, in Hypothesis 2, the result expects the estimated coefficient of social capital to be positive: ya& : yu.
= 0, ya( : yu.
O 0.
This test intends to examine whether there is evidence supporting the idea that the level of social capital increases the likelihood of participation in giving to institutions and the portion donated.
Data and Variables This study employed a quantitative survey design administered via an online questionnaire to gather primary data from Muslims in Indonesia.
The participant selection process was guided by a multistage clustering sampling method to construct a sample that precisely matched the study's analytical requirements.
The survey was created using the Qualtrics platform and distributed by enumerators in various regions.
In the first stage, respondents were limited to individuals who identify as Muslims.
The second stage categorised samples according to their geographic location .
, province, city, and distric.
Next, the survey applied age restrictions requiring participants to be 18 years or older.
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focused on respondents who are donors, regardless of whether their donations are for religious or general charitable causes.
Moreover, the sample was further segmented based on the methods of donation .
, individual, organisation, and Consequently, this study adjusted the sample to fulfil its research objectives and yield pertinent results.
A total of 1,600 initial responses were collected.
The structural analysis specifically examines the behaviour of zakat payers, both zakat fitrah and maal.
hence, the analysis was limited to respondents who verified their eligibility to pay zakat, defined as having income above their basic needs, above USD133 per month.
Subsequently, the refining method produced a final analytical sample of 829 responders .
ee Figure 2 for sample distributions, and Table 1 for the respondentsAo district distributio.
A primary finding of this study points to a fundamental challenge in institutional zakat management.
As detailed in Table 2, the final sample is outlined, which reveals a significant finding: A majority .
82%) of eligible zakat payers prefer direct, inperson payments to recipients rather than through formal zakat organisations, underscoring a considerable obstacle to institutional zakat collection.
Figure 2.
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Table 1.
Respondent distribution City/District Respondent Percent Aceh Dharmasraya Bandung Bekasi Bogor Jakarta Pandeglang Semarang Yogyakarta Pacitan Pasuruan Pontianak Gowa Denpasar Jayapura Total Table 2.
Preference for zakat payment to organisations Payment to zakat organisations Observation Yes Notes.
Respondents were asked whether or not they allocated their religious giving .
, zakat fitrah and maa.
through a zakat organisation.
The empirical analysis of payer behavior is predicated on two specifically constructed outcome variables.
First, a binary indicator was used to indicate the preference for payment to the Zakat organisation.
To measure this preference, the survey included a question asking respondents about their preferences for their zakat payment and the portion allocated to each chosen channel.
Second, the study employed the amount of zakat paid through an organisation as a continuous It has been observed that a majority of zakat payers .
%) allocate less than 20% of their zakat funds to a zakat agency.
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than 50% of their zakat.
Hence, the data confirms that most zakat payers distribute the majority of their zakat to non-zakat agencies.
Table 3 provides a more detailed breakdown of the percentages of zakat funds given to the zakat agency.
Table 3.
A portion of zakat is paid to charity organisations Portion (%) Observation Notes.
The total number of respondents who allocated their zakat through the zakat organisation was 358.
Respondents were asked how much of their zakat was allocated through a zakat organisation.
Furthermore, this research established explanatory variables in two major categories: religiosity and social capital.
In addition to those main categories, the study added sociodemographic information as control variables, as presented in Table 4.
In operationalizing the concept of religiosity, the study used the religiosity scale development (Dali et al.
, 2.
, which provides a multi-dimensional measurement, , the religious belief and commitment dimension.
For the belief dimension, the measurement consists of some basic and principal belief questions such as a statement of Muhammad .
eace be upon hi.
as GodAos final prophet.
AuI believe there is only one Allah.
I believe Al-Quranic teaching is suitable in todayAos lifeAy.
Auall humanityAos good deeds will be judged and rewarded accordingly after deathAy.
AuI think the prophetic traditions are ideal throughout all timesAy.
AuI believe that my faith is a source of comfortAy.
Regarding the commitment .
, practic.
dimension, the scale consists of practical questions about the influence of individualsAo religious beliefs on their daily lives, such as what they buy.
For more details, the questions include: AuI always keep myself away from earning through haram .
means, such as interest from conventional bankingAy.
AuI make sure that my dress/cloth covers my auratAy.
AuI always perform the zikrAy.
AuI follow the Sunnah of the Prophet in daily lifeAy.
Aumy religious beliefs influence which service providers I useAy.
Aumy whole approach to life is based on my religionAy.
AuI need to spend time in private thought and prayerAy.
AuI regularly offer prayer five times a dayAy.
This measurement uses a Likert scale ranging from 1 to 5, which is then converted into an index.
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Table 4.
Descriptive and summary statistics Variables Descriptive Obs.
Mean Min Max Measure of giving Preference Zakat payment via a charity Portion A portion of zakat is paid to charity organisations Measure of religiosity Practice Commitment to practice religious teaching in daily life Belief Belief in God and religious Measure of social capital Social trust Trust in other people in family, village, same and different backgrounds, traders, government, judges, police, and politicians.
Social norms Perception is that most people are trusted, helpful, and fair.
Sociodemographic Gender 1 if male and 0 if female Education RespondentsAo schooling years Income RespondentsAo income measured in USD.
3,458
2,580
1,603
40,072
Location 1 if living in an urban area, and 0 otherwise Notes.
The outcome variable is a binary, while the explanatory variable is an index, with a formula: .
cu Oe min .
)/ .
Oe min .
The control variables, gender, education, income, and location, are included in the analysis.
however, only the primary variables are reported.
Reliability test: the resulting alpha coefficient .
, outcome and explanatory variable.
4561 indicates low internal consistency, suggesting that the items may not reliably measure a single underlying construct.
Validity test: items .
Preference and Portio.
loaded strongly on Factor 1 (OO 0.
suggesting a coherent latent construct likely related to institutional zakat preference.
Practice and Belief loaded moderately on Factor 2, indicating a distinct dimension possibly reflecting religiosity, while Trust and Norms showed moderate loadings on Factor 3, pointing to a third latent factor associated with social capital.
Hence, the investigation applied a robustness test using alternative indicators and models to enhance the results For the measurement of social capital, this study used two indicators for the social capital measurement, i.
, social trust and generalised social norms (Narayan & Cassidy, 2.
The first, a leading indicator, is extracted from questions that ask respondents about their confidence in people from their family, village, same and different backgrounds, traders, government officials, judges, police, and politicians.
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The second indicator, as an alternative, is based on respondentsAo perception that most people are trustworthy, helpful, and fair.
Eventually, this study summed up the scores from each measurement and used them as indicators of social trust and generalised norms.
All responses were on a scale from 1 to 5, then converted into an Finally, to account for potential confounding effects and ensure the robustness of the model, the study collected sociodemographic information, including education, income, gender, and location.
The survey then examined education indicators by calculating respondentsAo schooling years between 0 and 21 years and created dummy variables for gender .
if male and 0 if femal.
, and location .
if living in an urban area, and 0 otherwis.
Results and Discussion Empirical Results The regression results in Table 5 offer clear and robust insights into the factors influencing zakat payment behaviour in Indonesia.
Overall, the analysis confirms that religiosity and social capital are significant positive predictors of institutional zakat contributions, though their relative impacts differ.
The methodological analysis results validation of a substantial positive correlation between religiosity, assessed through religious practice, and institutional zakat contributions.
The coefficients, 0.
182** .
<0.
for preference 527** .
<0.
for portion, are both statistically significant and substantively This suggests that persons who engage more passionately in their religious practices are considerably more inclined to direct their zakat through formal institutions and to designate a greater portion of their donations via institutional channels.
Furthermore, the analysis indicates a significant function for social capital, particularly social trust.
The positive and statistically significant coefficients suggest that individuals with elevated levels of social trust are more likely to select official zakat organisations and allocate a greater share of their zakat through these entities.
The significance of these coefficients, 0.
0104*** .
< 0.
for preference and 0378*** .
< 0.
for portion, indicates a substantial economic impact.
A one-unit increase in social trust correlates with a 1% and 3% rise in the likelihood of favouring formal zakat institutions and the amount donated, respectively.
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Interestingly, when comparing the magnitudes of these effects, the results reveal a crucial nuance.
While religious practice is a significant driver, its predictive power is modest compared to that of social capital.
The magnitude and statistical significance of the trust variable indicate that individuals who perceive higher levels of social trust are substantially more likely to prefer institutional zakat channels and allocate a larger portion of their zakat to these organisations.
Hence, the stronger predictive power of social capital over religiosity underscores a behavioural economics insight: trust reduces transaction costs and perceived risks associated with institutional giving.
Concerning the demographic controls, the trends also offer substantial insight into the control variables.
Living in an urban area is a notable determinant of both the preference and the portion allocated to zakat institutions.
This likely signifies the better accessibility and visibility of these institutions in urban areas compared to rural locations.
Table 5.
Regression results on zakat payment to charity Variables .
Preference (OLS) .
Portion (PPML) .
533***
978***
Measure of religiosity Practice Measure of social capital Trust
Controls Location Constant
393***
902***
Observations R-squared Gender
YES
YES
Education YES
YES
Income
YES
YES
Location YES
YES
Notes.
Robust standard errors are shown in parentheses.
***, **, and * represent statistical significance at the 1%, 5%, and 10% levels, respectively.
The table presents estimates from the regressions that determine whether the explanatory variables Aii.
, religious practice and social trustAiaffect participation and the portion of giving to zakat organisations.
All regressions include the control variables for gender, education, income, and location .
rban/rura.
However, only primary and significant variables are reported.
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Robustness Results This investigationAos analysis also applied two models to check the robustness of the primary regression.
First, it operated LPM and PPML regression by replacing the leading indicators, i.
, religious practice and social trust, with religious belief and generalised social norms as alternative indicators for religiosity and social capital.
Subsequently, it used Probit and Logit models to assess the robustness of zakat payment preferences, as well as OLS and Tobit estimations for the portion of zakat.
Table 6.
Robustness check
Alternative Definitions Variables Preference Portion
(OLS)
(PPML)
Alternative Models Preference Portion (Probi.
(Logi.
(OLS) (Tobi.
380***
254***
147***
302***
Measure of religiosity Belief Practice Measure of social capital Norms 324*** 957*** .
Trust
Controls Location Constant
026***
793***
Observations R-squared Gender
YES
YES
YES
YES
YES
YES
Education YES
YES
YES
YES
YES
YES
Income
YES
YES
YES
YES
YES
YES
Notes.
Robust standard errors are shown in parentheses.
***, **, and * represent statistical significance at the 1, 5, and 10 per cent levels.
The table presents estimates from the regressions that determine whether the explanatory variables, i.
religious belief, practice, social trust, and norms, affect participation and the portion of giving through zakat organisations.
All regressions include the control variables for gender, education, income, and location .
rban/rura.
However, only primary and significant variables are reported.
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Table 6 shows the regression results for the robustness check.
It indicates consistent results with the main results of this investigation.
This consistency is evident in the two alternative indicators, which exhibit a positive association with both outcome variables.
However, the results of the social capital measurements remain more significant than those of religiosity, as they show substantial results only at the 5% and 10% levels.
Hence, the Probit and Logit models also yield consistent results regarding preference, and the OLS and Tobit models support the main regression findings.
Discussion The empirical findings of this study offer a crucial insight into the behavioral drivers of institutional zakat payment in Indonesia.
While confirming the established positive link between religiosity and charitable giving, the results reveal a more profound conclusion: social capital, specifically social trust, emerges as a more powerful and significant predictor of both the preference for formal zakat channels and the portion of zakat allocated to them.
To contextualize these findings within a global context, it is valuable to compare the regulatory landscape of zakat in Indonesia with that of other Muslim-majority According to a previous study, there are three categories of zakat implementations: mandated by state laws, state-run voluntary charity and voluntary organisations without government intervention, within Muslim countries (Allami, 2.
In the case of Indonesia, zakat is not mandated by law, denoting that zakat payment is entirely voluntary, not enforced, and run by both government and non-government organisations.
Unlike in Malaysia, where zakat collection is largely state-managed and implemented in certain states (Achour et al.
, 2015.
Mukhlishin et al.
, 2024.
Omar & Khairi, 2.
, or Pakistan, where a centralised and mandated zakat system exists alongside traditional practices (Ahmad et al.
, 2017.
Gilani, 2.
IndonesiaAos system is fundamentally voluntary and decentralised.
This key difference helps explain the less powerful religiosity, compared to social capital, as a direct driver of institutional payment in this study.
In more state-integrated systems, religious duty is often reinforced by legal obligation, making religiosity a primary predictor of compliance.
In Indonesia, however, the absence of state coercion creates a context where generalised religious devotion, while high, does not automatically translate into using formal channels.
Instead, as the results show, social capital, specifically, trust in institutions, becomes the pivotal factor.
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by the governing institutional framework.
In the Indonesian context, where zakat institutions vary in terms of transparency and accountability, trust becomes a crucial heuristic for donor decision-making.
Religious practice may motivate the act of giving, but trust determines where and how much is given.
The empirical findings of this study offer an insight into understanding the behavioural drivers behind institutional zakat payment in Indonesia.
Although confirming the established positive association between religiosity and charitable giving (Brooks, 2005.
Glanville et al.
, 2016.
Herzog & Yang, 2.
, the results crucially reveal that social capital, specifically social trust, is a more powerful and significant predictor of both the preference for formal zakat channels and the portion of zakat allocated to them.
This finding seems to align with the idea that prosocial behaviours, particularly zakat payment, are not only driven by religious belief (Stark, 2.
but also by social capital (Abdul-Jabbar & Bin-Nashwan, 2022.
Choi & DiNitto, 2012.
Forbes & Zampelli, 2013.
Herzog & Yang, 2018.
Kasri & Ramli, 2019.
Kasri & Yuniar, 2021.
Sadallah & Abdul-Jabbar, 2.
Hence, this finding calls for a thoughtful discussion that contextualises IndonesiaAos experience within a global framework and draws concrete policy implications for regulators and zakat The Primacy of Social Trust in a Global Context The less-powerful-than-expected direct effect of religiosity is a defining feature of IndonesiaAos unique socio-legal landscape for zakat.
Unlike in countries with stateenforced zakat systems, such as Pakistan or Malaysia, where religiosity is reinforced by a strong sense of legal obligation (Abdul-Jabbar & Bin-Nashwan, 2022.
Ag Omar et al.
, 2021.
Ahmad et al.
, 2017.
Gilani, 2006.
Mukhlishin et al.
, 2.
, the practice in Indonesia remains voluntary and is characterised by persistent fiqh disputes over the necessity of institutional payment (Fauzia, 2013, 2.
This ambiguity creates a decision-making environment where intrinsic religious motivation, while foundational, is channelled into the general act of giving but does not merely dictate the channel.
In the absence of a clear religious or legal mandate, individuals must rely on other cues to resolve the uncertainty.
This is where social capital becomes Social trust acts as a critical heuristic or risk-mitigation mechanism: when a payer trusts that an institution is legitimate, transparent, and effective, it reduces the perceived risk of their religious obligation being fulfilled Therefore, in IndonesiaAos context, social capital does not replace religiosity but rather operationalises it.
it provides the necessary assurance that Economica: Jurnal Ekonomi Islam Vol 16.
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transforms the general religious intention to pay zakat into a specific decision to pay through a formal institution.
The results, however, find strong character in other Muslim-majority contexts with decentralised or voluntary systems.
The robust and significant effect of social trust supports the global literature, which asserts that trust is the bedrock of charitable behaviour (Choi & DiNitto, 2012.
Forbes & Zampelli, 2.
It empirically validates the theoretical mechanisms proposed in the literature review: that social capital operates by .
enforcing pro-social norms through community networks (Herzog & Yang, 2018.
Kasri & Ramli, 2.
, and .
crucially, by cultivating institutional trust (Abdul-Jabbar & Bin-Nashwan, 2022.
Sadallah & Abdul-Jabbar.
In Indonesia, where the state cannot mandate payment, trust becomes the essential currency that replaces coercion.
Individuals are more likely to pay their zakat to an institution only if they trust it to be legitimate and effective in its distribution, a finding that echoes studies on zakat compliance in other contexts, such as Malaysia and Pakistan (Abdul-Jabbar & Bin-Nashwan, 2022.
Ahmad et al.
Gilani, 2006.
Sadallah & Abdul-Jabbar, 2.
This comparative perspective underscores that the relative importance of religiosity versus social capital is not absolute but is critically mediated by a countryAos regulatory and governance Recontextualising Fiqh Zakat in Modern Indonesia through the Maqasid Al-Shariah The historical resistance to centralised collection, rooted in colonial-era fiqh interpretations that deemed the state illegitimate (Fauzia, 2.
, is being reshaped by demonstrable institutional performance.
The data cited on the growing market share of BAZNAS indicates that trust is being earned through perceived reliability and scale.
The documented failure of direct, in-person distribution to significantly improve societal welfare (Zakiyah, 2.
further strengthens the argument for a modernised fiqh perspective.
This perspective must be explicitly grounded in the framework of Maqasid al-Shariah .
, the objectives of Islamic La.
, which provides the ultimate criteria for evaluating Islamic rulings.
The primary purpose of zakat is intrinsically linked to the fulfilment of key Maqasid, particularly the preservation of wealth .
ifz al-ma.
by circulating it to prevent hoarding, and the preservation of life and lineage .
ifz al-nafs wa al-nas.
by ensuring the basic needs of the poor are met.
A purely formalistic adherence to fiqh opinions that permit individual distribution, while technically valid, can be 284 | Vol 16.
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counterproductive if it systematically fails to achieve these higher objectives.
The empirical findings of this study demonstrate that the current system, which heavily relies on direct payment, results in a significant gap between zakat potential and This inefficiency directly hinders the realisation of Maqasid al-Shariah on a societal scale.
Therefore, a contemporary ijtihad should prioritise maslaha .
public interes.
by endorsing the collection method that proves most effective.
This study provides robust evidence that institutional channels, enabled by social trust, are the method.
As the above critical analysis suggests.
IndonesiaAos zakat landscape is at a crucial While religious beliefs motivate giving, social trust and established norms dictate the methods of contribution.
The analysis of this study reveals that the countryAos voluntary zakat system poses unique challenges, with trust being a central Therefore, the evolving Indonesian context, with its advanced technology and growing institutional capacity, necessitates a renewed interpretation that aligns religious practice with the most effective modern mechanisms for social change, thereby ensuring that the jurisprudence of zakat .
, fiqh al-zaka.
faithfully serves its ultimate divine purposes, as outlined in the Maqasid al-Shariah.
Conclusion This article utilises the survey dataset to provide empirical evidence on the role of religiosity and social capital in influencing giving decision-making among Indonesian Muslims, particularly their decisions to donate through charitable organisations and the allocation of their religious donations to these organisations.
In doing so, the study employed the LPM to define the likelihood of zakat payment preference, as this model is more flexible, easier to interpret, and helpful for estimating its effects.
Additionally, the study employed the PPML to investigate the impact of the main explanatory variables on payment preference and the portion of Using the PPML, the study aimed to address the heteroscedasticity problem and ensure the regression model accurately describes the portion of zakat paid to the agency.
The LPM and PPML results confirm the positive relationship between religiosity, the zakat payment preference, and its portion.
This suggests that individuals with higher levels of religiosity are more likely to pay for their zakat through zakat organisations, with a larger portion of their zakat than those with a lower degree of religiosity.
This less-powerful result confirms that the role of religiosity needs to be enhanced.
For this reason, this study suggests revitalising the Economica: Jurnal Ekonomi Islam Vol 16.
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fiqh of zakat, particularly from its collection aspect.
This renewal is essential as Indonesian Muslims face fiqh debates and uncertainties in zakat collection Thus, practically, for Muslim scholars, designing a fatwa or ijtihad in the fiqh of zakat collection under an authorised organisation should generate distinctive roles in increasing the efficiency and effectiveness of zakat collection through zakat organisations to achieve sustainable economic development.
Notably, these findings also highlight the importance of social and human capital.
As discussed in prevailing studies, the hint suggests convincing evidence that greater social trust, generalised norms, and educational experiences will increase the zakat payment preference for the zakat organisation and its portion.
This article contributes to extending the empirical evidence on the role of religiosity and social capital in shaping the giving behaviours of Indonesian Muslims.
The results also empirically confirm the ambiguity of the application of zakat payment and collection.
Hence, this study suggests recontextualising fiqh, particularly the fiqh of zakat and its application in Indonesia, especially the law of zakat collection, to ensure equality in zakat distribution and develop a sustainable public policy.
Despite its contributions, this study has limitations that might encourage future As this study focuses on the behavioural aspects of zakat payment, it does not engage directly with the theoretical discourse on the revitalisation of fiqh or its integration with the Maqasid Al-Shariah framework.
This presents a valuable avenue for future theoretical research to complement the empirical findings presented in this study.
Additionally, this research employed a limited sample size and focused on upper-income class respondents.
extending the sample, especially reaching wealthier respondents, would be interesting.
Moreover, it might be more interesting to expand the measure of religiosity in more detail, such as religious education experience, either from formal or informal education, as well as separately analyse zakat fitrah and zakat maal payment preferences.
The empirical evidence presented here provides a clear mandate for Indonesian zakat authorities and institutions to strategically pivot from appeals based solely on religious duty towards systematic trust-building as a core policy objective.
For regulators, the government, through the Ministry of Religious Affairs.
Badan Amil Zakat Nasional and Badan Wakaf Indonesia, should move beyond coordination to active regulation that mandates transparency.
Policies should require all licensed zakat institutions to publicly disclose audited financial statements and, more importantly, provide concrete data on their social impact .
, the number of 286 | Vol 16.
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families lifted out of poverty, educational scholarships granted, successful entrepreneurship programs, and the social return on zakat distributio.
This would institutionalise trust-building, creating a regulatory environment where trust is not just encouraged but required and independently verified.
Moreover, the government and its zakat agencies should lead a collaborative effort with the Majelis Ulama Indonesia (MUI) and major Islamic organisations to issue a clear, contemporary fatwa or ijtihad that addresses the historical ambiguity in fiqh.
This should emphasise the maslaha and the objectives of shariah .
maqasid al-sharia.
in achieving greater poverty alleviation and social justice through organised, transparent collection and distribution.
This religious endorsement would provide the theological reassurance needed to complement public trust.
For zakat institutions, both government and non-government zakat organisations, the findings on urban uptake and the power of social norms suggest institutions must deepen engagement beyond digital campaigns.
Formal partnerships with trusted community or religious leaders, such as village heads, kyai, and university figures, can serve as powerful trust brokers, especially in rural areas where institutional presence is weaker.
Furthermore, zakat agencies might want to consider targeting demographic strengths with tailored communication .
, urban populatio.
Moreover, institutions should intensify digitalisation efforts and design marketing campaigns that highlight efficiency, transparency, and measurable impact, tailored to this demographicAos values.
Conversely, for rural demographics, communication should focus on the religious legitimacy and community benefits of organised zakat.
Eventually, bridging the urban and rural regions might also be worth consideration.
The lower institutional uptake in rural areas signals a need for proactive outreach.
Strategies could include mobile collection units, partnerships with rural banks and cooperatives, and educational programs that clearly articulate the systemic benefits of organised zakat distribution over individual, in-person giving.
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BIBLIOGRAPHY