The development of new economic model in order to reduce the cost of living and improved well-being of society

Lately, the community feels burdened due to the increase of goods and services prices, which led to an increase in the cost of living (CPI increased from 110. 5 in 2014 to 112. 8 in 2015) and affected the well-being of society. This scenario becomes more complicated and an alternative solution to overcome this problem is still fuzzy. Many efforts have been taken by the authorities such as BR1M, KR1M, etc., but those efforts seem to be ineffective to prevent an increase in the cost of living. A few questions need to highlight regarding this matter i.e.: (1) Why is an increase in prices of goods and services is necessary? (2) How to control the rising cost of living in the long run? (3) How to make sure the involvement of the active participation in the society in term of economic activities, whom can directly control the rising cost of living as a whole? (4) Why is society involvement important in controlling the rising cost of living? Therefore, this research aims to develop new holistic profits sharing model (HPSM) which contrary to the existing profits sharing models, which favoring to the business owners. Meanwhile, in this proposed model, the profits will be shared equally between employers, employees and customers through modification of the redemption points systems called HPS-2E1C. Thus, the study is divided into three phases: Phase (1) Development of a profit-sharing model cycle; Phase (2) Development of profit-sharing models; Phase (3) The implementation of the models. The findings revealed that the new models (HPSM) developed are not only can increase profits as compared with the existing model, but also can control the rising prices of goods and services, attract the active participation of society in economic activities that can directly control the cost of living as a whole and the importance of society involvement in order to control the rising cost of living.