The noted authors explain that the main contribution of this study is to present a model in which juristic and moralist positions are endogenized and augmented to constitute Islamic social welfare function.
There is need for an economic framework that brings moderation, responsibility, conservation, dignity of life, empathy, sharing, equitable distribution and justice in society.
Many professionals today experience a dilemma where they must make a choice between being good humans and being good at their job. They are left to wonder how the principles of love, generosity, fairness, reciprocity, and trust that they know to be true about life in general, do not apply at work. Some resort to the unfortunate conclusion that cold selfish behaviour is “natural” for human beings in economic situations. This is false. One of the prime reasons for moral listlessness at the workplace lies buried in mainstream economic theory.
Famine, death from hunger and debt enslavement is the fact of life for the half of the people on earth not because that overall, the societies have scarce resources, but because the distribution of resources is inequitable as empirically proven by Nobel Laureate Amartya Sen and noted by Thomas Piketty in his recent book ‘Capital in the Twenty First Century’.
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.
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.
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.
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.
Islam has given women a share in inheritance. Before Islam, women were not only deprived of that share, but were considered as property to be inherited by men. In Islam, whether a woman is a wife or a mother, a sister or a daughter, she receives a certain share from the wealth of the deceased close relative.
This article takes a brief look at the theory of the firm in Islamic economics and how a firm’s objectives and governing framework is different in Islamic economic framework as compared to the neoclassical and value-neutral economic framework.
Reflections on the Origins in the Post COVID-19 World (Paperback)
ISBN: 978-96923470-0-6 An engaging book to reflect on the origins and the deeper questions of existence and meaning in life in the light of knowledge from science, philosophy and faith as we live through and beyond the COVID-19 world.
$8.00
Islamic Economics Project 