MSMEs and Social Justice in a Religiously Embedded Economy: A Maqashid Shariah Perspective
Abstract
Religiosity plays a crucial role in influencing economic life, including the economic activities carried out by MSMEs around university areas. Local economic activities play an important role in improving community welfare, particularly through MSME activities in the vicinity of campuses in Bangkalan, Madura. However, research on the transformation of religiosity into social justice remains limited. This study aims to explore MSME economic activities as an effort to promote social justice among religiously based local economic actors using the Maqashid Shariah framework. The research adopts a mixed-method design, involving 100 MSME respondents and 10 key informants. Qualitative data were analyzed using thematic analysis based on the dimensions of Maqashid Shariah, while quantitative data were analyzed using descriptive statistics. The findings indicate the realization of social justice across the Maqashid Shariah dimensions. The highest level of realization is observed in Hifz al-Din (83.76%), indicating strong adherence to ethical and religious values in business activities, reflected in attitudes of honesty, trustworthiness (amanah), and justice in daily transactional practices. However, there are notable. However, there are notable differences across the dimensions. The results suggest that MSMEs not only contribute to economic welfare but also foster the development of a more religiously grounded human life.
References
Abdullah, M., & Hoetoro, A. (2021). Islamic values and economic development: The role of religiosity in human development outcomes. Journal of Islamic Monetary Economics and Finance, 7(2), 345–366. https://doi.org/10.21098/jimf.v7i2.1310
Acemoglu, D., & Robinson, J. A. (2020). Why nations fail revisited: Institutions and prosperity. Cambridge University Press.
Ali, A. J., & Hassan, M. K. (2021). Islamic business ethics and MSME sustainability in developing economies. Journal of Islamic Marketing, 12(4), 845–860. https://doi.org/10.1108/JIMA-03-2020-0078
Alkire, S., & Foster, J. (2021). Counting and multidimensional poverty measurement. Oxford Poverty & Human Development Initiative Working Paper.
Asutay, M. (2020). Islamic moral economy as a discipline: A critique of Islamic economics. International Journal of Islamic and Middle Eastern Finance and Management, 13(2), 292–309. https://doi.org/10.1108/IMEFM-03-2019-0125
Auda, J. (2020). Maqasid al-shariah as philosophy of Islamic law: A systems approach. London: The International Institute of Islamic Thought.
Audretsch, D. B. (2021). The economics of knowledge spillover. Oxford University Press.
Audretsch, D. B., & Belitski, M. (2021). Towards an entrepreneurial ecosystem typology for regional economic development. Journal of Business Research, 128, 437–447. https://doi.org/10.1016/j.jbusres.2021.02.045
Ayyagari, M., Demirgüç-Kunt, A., & Maksimovic, V. (2020). Small and medium enterprises across the globe: A new database. World Bank Economic Review, 34(1), 1–28. https://doi.org/10.1093/wber/lhz010
Bartik, A. W., Bertrand, M., Cullen, Z., Glaeser, E. L., Luca, M., & Stanton, C. (2020). The impact of COVID-19 on small business outcomes and expectations. Proceedings of the National Academy of Sciences, 117(30), 17656–17666. https://doi.org/10.1073/pnas.2006991117
Beck, T., & Demirgüç-Kunt, A. (2006). Small and medium-size enterprises: Access to finance as a growth constraint. Journal of Banking & Finance, 30(11), 2931–2943. https://doi.org/10.1016/j.jbankfin.2006.05.009
Beekun, R. I. (2020). Islamic business ethics. International Institute of Islamic Thought.
Boschma, R. (2021). Proximity and innovation: A critical assessment. Regional Studies, 55(1), 1–10. https://doi.org/10.1080/00343404.2020.1737183
Braun, V., & Clarke, V. (2021). Thematic analysis: A practical guide. SAGE Publications.
Chapra, M. U. (2021). Islam and economic development: A maqāṣid perspective. Islamic Research and Training Institute.
Cirera, X., Comin, D., Cruz, M., Lee, K. M., & Torres, J. (2021). Technology adoption and productivity in developing countries. World Bank Economic Review, 35(S1), S70–S92. https://doi.org/10.1093/wber/lhab016
Creswell, J. W., & Plano Clark, V. L. (2021). Designing and conducting mixed methods research (3rd ed.). SAGE Publications.
Duranton, G., & Puga, D. (2020). The economics of urban agglomeration. Handbook of Regional and Urban Economics, 5, 467–560. https://doi.org/10.1016/S1574-0080(19)80008-2
Dusuki, A. W. (2021). Operational challenges in maqāṣid al-shariah measurement. ISRA International Journal of Islamic Finance, 13(2), 1–15.
Fleurbaey, M. (2020). Beyond GDP: The quest for a measure of social welfare. Journal of Economic Literature, 58(4), 1029–1075. https://doi.org/10.1257/jel.20191561
Florida, R., Adler, P., & Mellander, C. (2021). The city as innovation machine. Urban Studies, 58(5), 1–18. https://doi.org/10.1177/0042098020957613
Freeman, S. (2020). Rawls and justice as fairness: A restatement. Harvard University Press.
Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2022). A primer on partial least squares structural equation modeling (PLS-SEM) (3rd ed.). SAGE Publications.
Haltiwanger, J. (2021). Entrepreneurship during the COVID-19 pandemic: Evidence from new business applications. Small Business Economics, 57(3), 1235–1248. https://doi.org/10.1007/s11187-021-00470-2
Haneef, M. A., et al. (2021). Maqāṣid al-shariah and sustainable development goals: An integrative framework. International Journal of Islamic and Middle Eastern Finance and Management, 14(3), 1–20.
Hasan, M., & Hassan, M. K. (2020). Islamic economics and sustainable development: A Maqashid perspective. International Journal of Islamic and Middle Eastern Finance and Management, 13(3), 456–472. https://doi.org/10.1108/IMEFM-05-2019-0193
Hasan, Z., & Dridi, J. (2021). The role of Islamic ethics in economic development and financial behavior. Journal of King Abdulaziz University: Islamic Economics, 34(2), 45–67.
Huggins, R., & Thompson, P. (2020). Entrepreneurship and regional economic development: A network perspective. Regional Studies, 54(1), 1–12. https://doi.org/10.1080/00343404.2019.1624718
International Labour Organization. (2021). World employment and social outlook 2021: The role of SMEs in job creation. Geneva: ILO.
Iqbal, Z., & Mirakhor, A. (2020). Ethical dimensions of Islamic finance: Theory and practice. Cham: Springer. https://doi.org/10.1007/978-3-030-34445-6
Kamali, M. H. (2021). Maqasid al-shariah made simple. Herndon: The International Institute of Islamic Thought.
Kamla, R., & Alsoufi, R. (2020). Critical Muslim intellectuals’ discourse and the issue of Islam and accounting. Accounting Forum, 44(4), 341–365. https://doi.org/10.1080/01559982.2020.1735686
Kotler, P., Kartajaya, H., & Setiawan, I. (2021). Marketing 5.0: Technology for humanity. Wiley.
Lincoln, Y. S., & Guba, E. G. (2020). Naturalistic inquiry. SAGE Publications.
Mohammed, M. O., & Taib, F. M. (2020). Developing Islamic banking performance measures based on maqasid al-shariah framework. International Journal of Islamic and Middle Eastern Finance and Management, 13(1), 1–20. https://doi.org/10.1108/IMEFM-12-2018-0432
North, D. C. (2021). Institutions and institutional change (updated discussions in institutional economics). Cambridge University Press.
OECD. (2021). OECD SME and entrepreneurship outlook 2021. OECD Publishing. https://doi.org/10.1787/97a5bbfe-en
Ravallion, M. (2020). On measuring global poverty. Annual Review of Economics, 12, 167–188. https://doi.org/10.1146/annurev-economics-081919-022924
Raza, S., Khan, A., & Iqbal, M. (2022). Trust and performance in Islamic micro-enterprises: Empirical evidence from developing contexts. Journal of Islamic Accounting and Business Research, 13(4), 789–805. https://doi.org/10.1108/JIABR-03-2021-0085
Ricklefs, M. C. (2021). Islamisation and its opponents in Java: A political, social, cultural and religious history, c. 1930 to the present. Singapore: NUS Press.
Robeyns, I. (2022). Wellbeing, freedom and social justice: The capability approach re-examined. Cambridge: Open Book Publishers. https://doi.org/10.11647/OBP.0300
Saunders, M., Lewis, P., & Thornhill, A. (2021). Research methods for business students (9th ed.). Pearson.
Sen, A. (2020). Capability and well-being revisited. In Development as Freedom Revisited. Oxford University Press.
Stiglitz, J. E., Fitoussi, J. P., & Durand, M. (2021). Measuring what counts: The global movement for well-being. The New Press.
Suryahadi, A., Al Izzati, R., & Suryadarma, D. (2020). The impact of COVID-19 outbreak on poverty: An estimation for Indonesia. SMERU Working Paper. https://doi.org/10.2139/ssrn.3693100
Tambunan, T. T. H. (2021). Micro, small and medium enterprises in Indonesia: Important issues and policies. Jakarta: LP3ES.
Teece, D. J. (2020). Dynamic capabilities and entrepreneurial management in large organizations. Strategic Management Review, 1(1), 7–18. https://doi.org/10.1002/smr.228
UNDP. (2022). Human Development Report 2021/2022. United Nations Development Programme.
Webb, J. W., Khoury, T. A., & Hitt, M. A. (2020). The influence of formal and informal institutional voids on entrepreneurship. Journal of International Business Studies, 51(3), 400–426. https://doi.org/10.1057/s41267-019-00267-3
Williams, C. C., & Horodnic, I. A. (2021). Tackling informal work in developing economies: A critical review. Journal of Development Studies, 57(9), 1483–1500. https://doi.org/10.1080/00220388.2020.1862872
Williamson, O. E. (2020). Transaction cost economics: The new institutional economics revisited. Journal of Institutional Economics, 16(3), 595–613. https://doi.org/10.1017/S1744137420000053
Wilson, R. (2021). Islamic finance and ethical investment. International Journal of Islamic and Middle Eastern Finance and Management, 14(3), 412–428.
World Bank. (2020). Small and medium enterprises (SMEs) finance. World Bank Policy Research Working Paper. https://doi.org/10.1596/1813-9450-8241
Zamagni, S. (2020). Prosperity, poverty and happiness: A new economic paradigm. Cheltenham: Edward Elgar Publishing. https://doi.org/10.4337/9781789909308
Zaman, A. (2021). Islamic economics: A survey of the literature. Islamic Economic Studies, 29(1), 1–27. https://doi.org/10.1108/IES-07-2020-0024
Downloads
Published
How to Cite
Issue
Section
License

This work is licensed under a Creative Commons Attribution 4.0 International License.
CC BY 4.0
Abstract views: 0
,
PDF Downloads: 0





