Human welfare in Islamic worldview encompasses economic welfare, but comprises much more than that. The achievement of human welfare is sought in both aspects of human life, i.e. worldly life and eternal life hereafter.
Welfare Function in Islam
Difference between Islamic Economics and Islamic Law
Even though the principles like prohibition of Riba and Zakat are binding as rules, they also have an important economic rationale and function in economic matters of an Islamic society. Hence, the mandate of Islamic economics will be to explain their economic merit using experimental and observational data and by applying statistical and other suited techniques to establish certain analytical hypothesis.
Ethics and Economics
As much as people can be selfish, they can be altruist as well. They have free will and they can be as much responsible as they can be reckless. What we need is a conditioning mechanism that nurtures positive tendencies.
Labor Productivity and Technical Progress in Islamic Economic Framework
In Islamic economic framework, increase in investment through entrepreneurial activities could increase the labor demand and wages. Increase in wages will improve the standard of living of poor labor class and enable them to improve their productivity further.
Critical Questions on Marxian Economics
Both the absence of broad based wealth taxes and the legal decree of allowing compound interest on money capital are the prime sources of wealth concentration. If both are corrected, capitalists would not be able to systematically exploit in competitive markets.
Is Islam the Cause of Underdevelopment
Abbas Mirakhor and Hossein Askari write that the claims of any society to call itself Islamic must be validated by the existence and effective operations of the institutional structure (rules of behavior). They opine that in today’s Muslim societies, the core elements of the institutional structure that would designate a system as Islamic are, by and large, notable for their absence.
Scope of Islamic Economics
Most of the description of human economic behavior in mainstream economics is trivial at best. Mankiw once wrote in a widely used textbook ‘people react to incentives, rest is commentary’. Islamic economics cannot confine itself to commentary on material pursuits alone. In mainstream economics, the important issues of equity, welfare, equitable distribution and institutions that can ensure these are at the periphery rather than at the center.
Critical Analysis of Arguments in Favor of Interest
This article briefly analyzes the logical arguments that are usually presented in the defense of interest as a price of money capital in loans.
Concept of Wealth in Islamic Economics
Islamic economics enables a Muslim society to achieve certain ends. It is not so difficult to understand that material resources are required in order to achieve the objectives or Maqasid of Shariah namely “preservation and protection” of Deen, Life, Family and Intellect. The purpose of Divine Law is to make mankind successful in Akhirah. Therefore protection of the religious and spiritual status of the mankind is the prime objective of Shariah. The remaining objectives are also meant to help toward achieving this bigger goal.
Material Progress and Islam
Allah asks people to use their intellect and exploit the nature’s blessings. Islamic principles neither stop one’s use of intellect in seeking material progress, nor the pursuit of success in life hereafter conflict in any way with success in this world provided that the ethical filters and Islamic injunctions are observed where they have been explicitly given.
Islamic Economics Project 