Contemporary economics considers rationality only in the context of this world without any regard to the life after death. Nonetheless, more than 90% of the people in the world are associated with any of the different religions and in most divine religions, there is concept of afterlife. The common definition of rationality would not describe their behavior as rational. This would be a violation of the basic assumption that economic agents are rational.
Divine Economics framework provides an empirical basis of behavioural comparison between religious and non-religious agents with regards to their economic and non-economic choices. It incorporates the methodological framework of mainstream economics for the study of religion and economics in each other’s perspective. It looks at religious behaviour from the lens of ‘economic good’ and ‘economic behaviour’ in markets where the choice has economic considerations, such as relative prices, opportunity cost of time, income effect and substitution effect. However, reliance on stated preferences, overlap between religious and non-religious activities, inability to observe the motivation and intention behind choices and to judge the quality of religious activities are some of the challenges in this research framework.
Islamic Economics Project 