abstention is the theme of fasting, but Muslims tend to spend more during the fasting month of Ramadan.
Although Muslims are required to fast -- to abstain from eating, drinking and sexual relations -- from dawn to dusk, they tend to eat more from dusk to dawn. At least, they prepare more delicious meals, with more variety -- and thus more expensive -- for their breaking of the fast.
Aside from foods, Muslims' spending on other goods and services also rises during the fasting month and for Idul Fitri, the end of the fasting month celebration. More people buy new clothes for themselves and for their families and most travel to their hometown at the end of the fasting month to celebrate Idul Fitri with their relatives.
In the end, Muslims simply spend more during the fasting month and Idul Fitri. Because of these higher spending needs, all employers are required by law to pay an extra Idul Fitri bonus to their employees.
Increased demand for goods and services during Ramadan creates economic dynamism. Those working in the food and beverage industry, textiles and garments as well as the transportation sector, directly benefit from this increased demand. Many businesses prosper during Ramadan and Idul Fitri.
Rising demand for goods and services is good for the economy. It drives growth. But, it is worrying that the supply side of the economy often cannot satisfy these sudden, but anticipated, increases in demand.
Because of constraints on the supply side, which cannot adjust easily to sudden increases in demand, the Ramadan and Idul Fitri celebrations traditionally result in higher inflation. The challenge for everyone responsible for economic management is to identify these supply constraints and to help address them.
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