Islamic Economics Project

Islamic Economics stands at a crossroads. To analyse what is, it must pragmatically adapt mainstream tools—provided they are stripped of reductionist assumptions. To articulate what ought to be, however, it must dare to innovate: developing tawhid-centric models that reflect humanity’s role as Allah’s stewards (khalifah). This dual approach rejects both uncritical integration and isolationist purism. As Dr. Shaikh advocates, pluralistic methodology allows IE to engage the mainstream while retaining its soul. The goal is not to mimic physics-envying economics, but to redefine economics itself—as a science of human flourishing, anchored in divine guidance. In the words of the Quran, “Do they not contemplate the Kingdom of the heavens and the earth?” (7:185). Islamic Economics, at its best, is this contemplation enacted—a discipline where tools serve truth, not the other way around.

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Moral Reflections on Economics, Vol 5, Issue 6

By Islamic Economics Project on June 4, 2025 • ( Leave a comment )

June 2025 issue (Vol 5, Issue 6) of Moral Reflections on Economics features article “Beyond Integrative Approaches: Methodological Tensions in Islamic Economics” by Aaliah Rafee, highlights of the IFSB Report 2025 by Muhammad Hammad, article on “What is Money” by Muhamed Ahmed, book review of “Economic Thinking of Arab Muslim Writers During the Nineteenth Century” by Prof. Abdul Azim Islahi, research paper in focus on Homo Islamicus and Homo Economicus by Dr. Setiawan and Dr. Sultan, reflections on Khutba-e-Hajjat-ul-Wida and regular sections of market news, economic and financial indicators and call for papers.

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Monetary Policy and Islamic Banks: A Critical Literature Review

By hammadiep on May 10, 2025 • ( Leave a comment )

The authors conclude that more research is needed to fully understand the relationship between monetary policy and Islamic banking. They emphasize the importance of considering factors like the structure of Islamic banks’ balance sheets and the influence of profit-and-loss sharing in deposits and financing. The authors note that the existing research has a lack of theoretical grounding. Most studies focus on whether monetary policy influences Islamic banks, but they do not investigate why this happens. The authors suggest that the theory of Islamic finance could offer explanations.

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Methodology of Islamic Economics

By hammadiep on May 9, 2025 • ( Leave a comment )

The book explains that the objective of religious life should be to change this world, including the personality of the individual himself and extending to the whole of human society, so as to reconstruct it in accordance with the will of Allah as revealed in the Qur’an. The religion should be understood directly from the Qur’an aided by the Sunnah, and all human interpretations should be treated as secondary, tentative and, in principle, liable to error and open to correction.

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Highlights of Global Energy Review 2025 Report

By hammadiep on May 8, 2025 • ( Leave a comment )

Different elements of the world’s energy system saw very different growth rates in 2024, reflecting the impact of short-term factors and deeper structural trends. Global energy demand grew by 2.2% in 2024, a notably faster rate than the annual average of 1.3% seen between 2013 and 2023. This uptick was partly due to the effect of extreme weather, which we estimate added 0.3 percentage points to the 2.2% growth. Despite this, energy demand grew more slowly than the global economy, which expanded by 3.2% in 2024, close to its long-term average.

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Labour in Comparative Economic Systems

By hammadiep on May 7, 2025 • ( Leave a comment )

In Marxian economics, it is argued that labor creates surplus value in the production process that capitalists extract in the exchange process. Marx said that the capitalist purchases the use value of labor (service) and pays labor something equivalent to the exchange value of labor time. It is barely enough to keep the labor survive. However, when the capitalist sells products created by “labor power,” these products command more exchange value and this excess is known as surplus value. The surplus accumulates and this is exploitation of labor by the capitalists.

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Moral Reflections on Economics, Vol 5, Issue 5

By Islamic Economics Project on May 6, 2025 • ( Leave a comment )

May 2025 issue (Vol 5, Issue 5) of Moral Reflections on Economics features

 Remembering Prof. Khurshid Ahmad

 Labour in Comparative Economic Systems by Salman Ahmed Shaikh

 Highlights of Global Energy Review Report 2025 by Muhammad Hammad

 Book review of Methodology of Islamic Economics edited by Syed Agil and Aidit Ghazali

 Research paper in focus on Monetary Policy and Islamic Banking by Zakaria Savon and Abdellah Yousfi

 Reflections on “Control Over Past and Present”

 Regular sections of market news, economic and financial indicators and call for papers.

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Life and Works of Prof. Khurshid Ahmad

By Islamic Economics Project on April 14, 2025 • ( Leave a comment )

Prof. Khurshid Ahmad passed away on April 13, 2025 at the age of 93 years in Leicester, UK. He was born on March 23, 1932 in Delhi. He was a renowned scholar, academic, economist, prolific writer, policymaker and legislator.

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Theoretical and Analytical Approach of Financial Stability: Islamic Perspective

By hammadiep on April 13, 2025 • ( 1 Comment )

Financial crises are often linked to unsustainable booms in financial and business cycles. Research shows that credit and house price cycles are closely tied to output cycles. From an Islamic perspective, synchronizing financial and business cycles can promote stability. A Shari’ah-compliant system without interest rates can align the financial cycle with the real economy, bolstering stability.

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The Divine Whispers

By hammadiep on April 12, 2025 • ( Leave a comment )

The book aims to reconcile scientific understanding with Islamic faith, suggesting that the natural world contains “divine whispers” that point to the existence and wisdom of God. It seeks to demonstrate that scientific discoveries can strengthen, rather than contradict, religious belief. The author addresses the limitations of purely materialistic scientific explanations, arguing that science, while valuable, cannot fully account for the origins and purpose of the universe. It is noted that science is limited to the observations of our senses, and the brain, which are limited to the material.

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