Unveiling the effects of zakat toward socioeconomic empowerment in OIC countries

Purpose This study aims to investigate the effect of zakat, an obligatory Islamic charity, on poverty, unemployment and income inequality across Organization of Islamic Cooperation (OIC) member countries. Design/methodology/approach Using quantitative methods and data from 42 OIC nations covering the period 2007–2019, the research assesses the effect of zakat distribution on these socioeconomic challenges. The analysis focuses on the role of zakat in wealth redistribution and its broader socioeconomic implications. Findings The results indicate that zakat significantly addresses poverty, reduces unemployment and promotes income equality by redistributing wealth from the affluent to the needy. This mechanism helps individuals meet basic needs, creates job opportunities and mitigates wealth concentration among specific groups. Research limitations/implications This study primarily relies on quantitative data from 42 OIC countries between 2007 and 2019, which may not fully capture the dynamic changes in socioeconomic conditions post-2019. In addition, this study focuses on the aggregate effects of zakat without exploring country-specific factors that may effect the effectiveness of zakat distribution. Practical implications To optimize zakat’s socioeconomic benefits, this study recommends increasing community participation in zakat obligations and improving the transparency and management of zakat distribution. Emphasis is placed on productive zakat programs aimed at job creation and income enhancement, which can empower recipients and foster long-term economic self-sufficiency. Originality/value This research offers a novel contribution by providing a comprehensive, cross-country analysis of Zakat’s role in addressing poverty, unemployment and income inequality within OIC member nations.