The efficiency of zakat collection and distribution: Evidence from two stage analysis

Since its corporatization,the collection of zakat by lembaga zakat selangor has increased from rm13.8 million in 1991 to rm336.8 million in 2010. however,some quarters have voiced concerns over the efficiency of zakat collection and distribution. therefore,this study attempts to analyze the efficiency of zakat management of lembaga zakat selangor. the annual report data for lembaga zakat selangor between 2001 and 2011 were devised. this paper utilizes the two stage linked data envelopment analysis model,as proposed by berber et al (2011). the findings show that: first,both collection and distribution have lagging resources that is referred to technical efficiency. second,the result shows a lower efficiency in distribution than in collection function. third,from the overall efficiency,allocative and cost efficiency scores show maximum efficiency is achieved almost every year. it reveals that lembaga zakat selangor is utilizing its input proportionately to ensure minimum cost incurred to produce a given output (amount collected and amount distributed) at a given input prices (cost collection and cost distribution). © 2014,statistical economic and social research and. all rights reserved.