​#    ​​​Title ​  Authors
​​ ​​​2017 ​ ​
​ 8-2018 The Economics of Happiness: The Truth and Lesson from Zakat Nurfaradilla Haron
Abdul Ghafar Ismail



Recent practice treats the contribution of non-profit organization (NPO) into corporate or government sectors; therefore the contribution of NPOs in system of national account (SNA) has obscured. Currently, zakat institution is considered as NPO and becomes part of the wider social security system which should be enforced by the state for the upliftment of the selected groups (asnaf) in society rather than being treated as a voluntary institution. However, the proper evaluation of its contribution is missing. Hence, it creates a difficulty in measuring the contribution of zakat on SNA and also GNP that captures the element of happiness for both payers and recipients. Therefore, this paper will contribute in two aspects. Firstly, the contribution of zakat on the economy by linking with NPO as prescribed under the system of national account. Secondly, zakat also provides the happiness to payers and recipients. By combining both, we are able to calculate the modified GNP Happiness.

Keywords: Philanthrophy; economic system; public policy; economic growth;