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Are Muslims practising moderation in their financial decisions?

Ramlee, Roslily and Syed Mohd Zain, Sharifah Raihan and Wan Husain, Wan Rohaida (2019) Are Muslims practising moderation in their financial decisions? Asian Academy of Management Journal, 24 (Supplement 1). pp. 157-170. ISSN 1394-2603 E-ISSN 2180-4184

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Abstract

Statistics and a survey of the literature revealed the existence of a massive problem in the financial prudence of Malaysians, including Muslims. One glaringly prominent aspect is the absence of a spiritual/religious interventionist approach in exploring the lack of consumer awareness that led to the present situation. Instead of attempting to solve the problem through brute economic policies, a wasatiyyah-oriented approach is warranted for informing consumers of their religious obligation to avoid profligate spending and adopt moderation in financial matters. Hence, the objective of this study is to examine the practice of moderation (the concept of wasatiyyah) among Muslims consumers in their financial decision-making. Primary data were collected through a self-administrated survey on a selected group of Muslim consumers. A relevant statistical software was employed to perform exploratory-factor analysis (EFA) through principal-component analysis (PCA), confirmatory factor analysis (CFA), and structural equation modelling (SEM) on the collected data. The findings demonstrated that moderation (wasatiyyah) partially mediates the relationship between materialism and financial decisions. Consequently, Muslim consumers who practice moderation while making their financial decisions are more conscious of their credit management and thus spend according to their means.

Item Type: Article (Journal)
Additional Information: 4738/73460
Uncontrolled Keywords: moderation (wasatiyyah), Muslim consumers, financial decision, financial literacy, materialism
Subjects: B Philosophy. Psychology. Religion > BP Islam. Bahaism. Theosophy, etc > BP188.16 Wasatiyyah. Moderation In Islam
H Social Sciences > HG Finance > HG179 Personal finance
H Social Sciences > HG Finance > HG201 Money
H Social Sciences > HG Finance > HG201 Money
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button): Kulliyyah of Economics and Management Sciences
Kulliyyah of Economics and Management Sciences > Department of Finance
Depositing User: Dr. Roslily Ramlee
Date Deposited: 31 Jul 2019 11:03
Last Modified: 31 Jul 2019 11:06
URI: http://irep.iium.edu.my/id/eprint/73460

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