How To Make Grandma’s Economics Work For Us

The Economics Of Grandmothers As Told By Zam Yahaya

Since the beginning of the MCO in the middle of March 2020 due to the COVID-19 pandemic,  for the first time within two years, Malaysians are more concerned about economy than politics.

Those working in industries related to travel and tourism were hit almost immediately when thousands lost their jobs.

This time around, the economic problem is quite unique since all related activities were stalled and people can’t work even if they want to or need to. It has got nothing to do with normal economic problems of demand and supply. It is simply because people need to remain where they are and distance themselves from each other. The phenomena was faced by almost every part of the world and affected the wholistic human life!

Luckily, our government was quick to respond with reactive and pro-active measures to ensure that people have food on the table and enough funds to spend by ensuring that money keeps changing hands. These came in the form of providing immediate and direct aid to the people as well as to certain critical industries, and subsequently came out with policies to provide a moratorium period for monthly mortgage and hire purchase repayments as well as various stimulus packages via awarding large number of small government construction contracts to prepare in advance for active economic activities.

Now that we have been under MCO for six months and the moratorium period is coming to its end, the real impact due to lower amount of economic activities ie how much and how fast money changed hands – would be felt. 

Resilient Malaysians

Most Malaysians adapted to it quite fast. Pilots who lost their jobs were quick to take up jobs as GRAB drivers or food delivery riders. Some quickly learn how to cook a few dishes and put up food stalls. When the MCO was relaxed in stages, Malaysians engaged in higher level of economic activities.  Productivity is high since everyone is concerned about how to be productive to earn a living, anticipating the worst to come. Well done Malaysians, I am proud to be one who immediately took up cooking to start a food business! Before MCO, I never thought I could do such a thing! Well, the saying is true, necessity is the mother of invention!

But that’s about productivity. And productivity is not all about output alone. Productivity is also about using available resources wisely. While conventional economists believe that resources are scarce to meet the ever-growing human needs and wants, and hence the cost of utilising one’s resources to meet one’s needs is at the expense of not being able to meet other needs. In economic terms, it is called “opportunity cost”. Supposedly you have 20 ringgit and you can use that either to go for a movie or foot massage. If you choose to use it to watch a movie, the opportunity cost of going to the movie is a foot massage.

However, the Islamic economic worldview looks at resources from a different perspective guided by the Quran which indicates that resources are not scarce, and that God has provided them in abundance for humans to learn how to utilise them effectively and wisely. Long ago, geologists believe that the amount of gold in this world is static and there will be a time where there is no more gold to be mined. However in recent decades, scientists have proven that the earth, by its movement, continues to produce new gold when new gold “veins” were discovered at places that once had no gold!  As such, the Islamic worldview on resources that is in abundance and not scarce as suggested by Adam Smith is quite true after all. Islamic economic practice also commands that the poor has a claim on part of the rich’s wealth.

Having said that, productivity is not all about producing and outputs. Its also about minimising usage or eliminating waste of resources. Our mothers and grandmothers don’t have to attend business school or economics class to understand and put such practice into habits. Perhaps they were raised during hard times when resources were scarce.

Mothers and grandmothers are particular about avoiding waste especially on food, electricity, water and fuel. It’s their habit to recycle or reuse almost everything. Water used to wash rice and rinse vegetables and fish will be used to water plants and vegetables. There is a special container near the kitchen to collect them. Fish and chicken parts as well as cuttings of vegetables were not thrown away into rubbish bins but a container to mix with soil to produce organic fertilisers. Long before we, the millennium generation, separated plastic, glass and metal trash, they have separated other used and leftover resources into something that can regenerate new resources!

When I was studying at University Malaya Business School, my economics lecturer, Dr Nathan, who was raised in a rubber estate, was very particular about utilising resources. He was the only lecturer who accepts assignments done on a reused A4 paper, no binding, but just staple it and submit.

Years later, when I was teaching Business Economics at a private college, the very first assignment that I gave, received “fantastic” submissions from my students. They spent money on colour papers, print the cover with hard papers and bind it nicely with plastic cover.  One student even used papers with perfumed on it. Another student had ribbons on the cover!

I immediately put a stop to it and emulate what my economics lecturer practiced years before. I even told those students that I don’t pay attention or give extra marks for presentation of assignments but only the contents and its substance. In fact I reminded them that I will deduct some marks if assignments are submitted using unnecessary resources. Economists must walk the talk. Resources are scarce and we must not waste it, but learn to regenerate it just like grandmothers did!

Economic Agents

So guys, each and everyone of us are economic agents and what we do everyday has an impact to the economy as a whole as well as to others around you. Start planting your own vegetables. Grow chilly even if you don’t eat it. Giving it away to others improves productivity. Start having separate containers to collect water after washing your rice, containers for fish waste, vegetable waste and other leftover food. Or perhaps, you can also start to minimise the usage of electricity or fuel. Start using the motorbike or your bicycle more often. Or better still, start moving your fat arse and walk.

Grandma also said: When life gives you lemons, operate a lemonade stand! There you go, Grandma’s economics 101, explained.

Remember, eliminating waste, reutilizing resources and regenerating new resources are part of productivity that contributes directly to the economic wellbeing of the society! – New Malaysia Herald

About the writer Zam Yahaya was a Banking and Capital Market professional by training and a graduate in Accounting Business Islamic Finance

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