A comparative study of the relative efficiency of conventional and Islamic pawnshop

• Main Authors: Ismail, Abdul Ghafar, Cokro, Widiyanto B. Mislan, Maamor, Selamah
• Other Authors: Obaidullah, Mohammed
• Format: Book Section
• Language: English
• Published: Islamic Research & Training Institute (IRTI) 2008
• Subjects: BP Islam. Bahaism. Theosophy, etc; HG Finance
• Online Access: http://repo.uum.edu.my/16561/1/rg80.pdf; http://repo.uum.edu.my/16561/; http://www.readbag.com/staff-ui-ac-id-internal-060603523-publikasi-obaidullah-micro4

The aim of this study is to measure and evaluate the productive efficiency of pawnshops related to the ability of pawnshops in providing and distributing funds to the society (marketability efficiency).The methodology used to perform efficiency analysis of conventional and Islamic pawnshops is Data Envelopment Analysis (DEA). This study uses CCR model and BCC model.This study also investigates the most productive scale size for pawnshops.Furthermore, by using independent t test we compare the mean of efficiency of conventional and Islamic pawnshops.The CCR and BCC efficiency score analysis results show that 5 and 11 pawnshops are relatively efficient,respectively.In addition, of 39 pawnshops in this study, 30 (76.90%), 5(12.90%), 4(10.20%) show increasing returns-to-scale, constant returns-to-scale, and decreasing returns-to-scale respectively.It indicates that the managers’ capability to utilize pawnshops’ given resources need to be enhanced to increase their efficiency in providing and distributing funds to society.The result of independent statistical tests show that the efficiency of conventional pawnshops is not different from the efficiency of Islamic pawnshops (ar-rahnu).