The Role of Waqf in Educational Development - Evidence from Malaysia

Abstract

This study explores the role of waqf in educational development for a developing country facing economic downturn and financial scandal. It focuses on an Islamic charitable institution and gathers information from the annual report for fourteen years, commencing in 2000. Results derived through multiple regression analysis indicate that waqf-based financing has a significant positive impact on educational development in Malaysia. The present study is limited to the case of an Islamic charitable institution and thus lacks the ability to provide generalizable findings. In the event of economic instability and constant rise in educational costs, waqf has the potential to facilitate the educational needs of meritorious students by reducing their financial burden. As this is the first attempt to empirically test the proposition of past studies that waqf can serve as a secondary source of finance for educational development, this study contributes to minimizing the gaps in the previous literature.