How Islam tackled the problem of poverty

I would want to know the Islamic perspective on the causes of Poverty, its effects and ways of eradicating it according to the Prophet.

All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad is His slave and Messenger.

First of all, you should know that this subject is a long one and many books and researches were published in its regard, hence it is not possible to discuss this matter in details here. However, we may say the following in brief:

1-    Islam is especially distinguished for connecting the worldly matters with the Hereafter, and it confirms that both richness and poverty are a test from Allah to His Slaves, and a person will be rewarded or punished according to his reaction. When a poor person realizes this fact, prescience becomes easier for him and thus he will have a good fate in this life and in the Hereafter.

2-    The reasons of poverty are various: poverty might be a pure test from Allah, and it might be a punishment for some sins, and it could result from unemployment. It might also be due to a given group of people exerting a monopoly on the money and preventing others from it; there are many other reasons.

3-    Poverty has bad consequences: it could lead to many bad social and moral circumstances, like the spread of theft, bribery, and so forth. The poor hating the rich is yet another consequence of poverty.

4-    Islam legislated many solutions for poverty, the most important of which is to be steadfast on the Religion of Allah and encourage people to work and abandon unemployment.

Among other solutions for poverty as well, is legislating Zakat and encouraging people to give charity so that the money will not be monopolized by the rich. The donations by the Muslim Treasury [Bayt Al-Maal] is also another solution which was practised during the brilliant ages of the Muslims, and this has had a good effect on the Muslim society at that time.

Allah Knows best.