Contrasts Between Western and Islamic Economics
paper prepared for 7th International Conference in Islamic Economics, King Abdul Aziz University, Jeddah, 1-3 April 2008. Originally entitled "Prelude to Islamic Economics" - revised and updated. See also Lecture 6 in Islamic Economics -- where this material is presented.
See link for a list of articles on this same theme: Quran Versus Samuelson Edited & Revised version incorporating some portions not covered below is co-authored with Rafat Mahmood:
Material in Sections 3 & 4 has been covered in Origins of Western Social Science
Material in Section 5 has been amply expanded and covered in an Islamlc Critique of Neoclassical Economics.
Material in sections 2 and 6 could be put together into a paper regarding goals of an economic system, and how pursuit of wealth fulfills western goals but not Islamic ones. Also section 6 describes Islamic approach to wealth and what is to be done with it -- this is unpublished.
However, closely related is my paper on: Wealth as an Index of SocioEconomic Welfare, Islamic Views
Material on Islamic concept of man in section 8 below could be covered in a new paper on Homo Islamicus Verus Homo Economicus.
1. Introduction
There is substantial disagreement on the main features of Islamic Economics, on its subject matter, goals, appropriate methodology, etc. To address this difficulty, in a recent survey of the literature (Asad Zaman 2009-2010), the author has presented the key distinguishing features of Islamic economics, focusing on the contrast with conventional neoclassical economics. In this essay, we present in detail some of the background which necessitates this differentiation between conventional and Islamic economics. We believe that development of the discipline has been substantially hindered by writers who have sought to create conformity between the two. In the words of Nasr (1991), Islamic Economics has “failed to escape the centripetal pull of Western economic thought, and has in many regards been caught in the intellectual web of the very system it set out to replace.” It is our hope that this delineation and demarcation will create greater consensus on the nature of Islamic economics, and focus future efforts in more fruitful directions.
Contrasts between Western and Islamic Economics. 1
1. Introduction. 1
2. Goals of the Economic System.. 2
2.1: Wealth is a Means to an End in Islam. 2
2.2 Wealth is an End in Itself in Capitalism.. 3
MATERIAL in sections 3 & 4 below has been covered in Origins of Western Social Science.
3. Differentiating Physical and Social Sciences. 3
4. Emergence of Western Social Sciences. 4
MATERIAL in sections 5 has been covered in An Islamic Critique of Neoclassical Economics
5. Achievements of Western Economic Theory?. 6
5.1 Applying Economic Theory to Achieve Development 6
5.2 Economics Theories do not match Observed Behavior 8
5.3 Other Critiques of Conventional Economics. 10
5.4 Re-inventing the Wheel?. 11
NEW PAPER may be based on Sections 2,6,7 -- However, somewhat similar ideas have been discussed in Wealth as an Indicator of Socio-Economic Welfare, Islamic Views
6. Using Material Wealth for Spiritual Pursuits. 13
7. Spending For the Sake of Allah. 14
7.1 Encouragement to Spend: 14
7.2 Purposes of Spending: 15
7.3 Suggested and Preferred Categories of Expenditure: 15
7.4 Codes of Conduct for Charity. 16
8 Islamic Concept of Man. 18
8.1 Freedom.. 18
8.2 Plasticity. 19
8.3 Human Development 20
9. Islamic Methodology. 22
10. Concluding Remarks. 24
11 References. 24