economic thought in the qur"àn and sunnah 71The relationship between saving and investment
The enlargement, or maximization, of the place of saving in the
Islamic illustration of consumer behaviour would require looking at
saving in the light of three main factors: the purpose of saving,
“Zakàh”, and the attitude of Islam towards profit and interest.
(i) The purpose of saving
As previously mentioned the reasons for saving could be categorized
under four labels, (a) bequeathing to heirs, (b) precaution against
unforeseen contingencies (uncertainty) (c) the postponement of con-
sumption, and (d) the accumulation of wealth from the desire to be
rich. The first purpose of saving, when it is for dependent heirs, is
given high priority and when it occurs (within reasonable limits) it
pleases God and renders reward in the Hereafter. The other (less
important) purposes of saving are not condemned providing that they
are in line with the moderation concept (leading a niggardly life in
order to be rich is condemned).
Reflecting this on equation (3) shows it as follows:(maximise) V = U (C, H, T, Sa, Sb), F (P) (4)
s.t. YWhere: Sa = Sa (P)
Sb = (Y – (C + H + T + Sa)
Sa = saving for bequeathing to dependent heirs
Sb = saving for other purposes
(other connotations are as above)(ii) Zakàh
Zakàh is an annual religious levy ordained in the core of the Islamic
teachings and regarded as a sort of worship which relates to the
other four main pillars of Islam (the other four are the testimony
that there is no God but one and Prophet Muœammad is His
messenger, prayers, fasting for the month of Ramadan, and pil-
grimage, Hajj, for whoever can afford it). Although Zakàh has var-
ious characteristics, it suffices to point out at this stage that it has
very special dual characteristics: the first as a type of worship, which
places it at the heart of the religion, and the second as a financial
levy that has economic implications for both its payer and receiver.