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Abstract

There is substantial evidence that the development of the discipline of Islamic Economics is currently in crisis. In this article we argue that the main reason for this is that most Muslim economists have accepted too many of the ideas of Western economists uncritically. The methodological framework, and underlying assumptions are wrong, and in conflict with Islamic views. This conflict has not been recognized, and the attempt to combine contradictory bodies of knowledge has failed. We also present alternative foundations on which a genuine Islamic economic theory could be constructed.

1. The Islamization of Knowledge

The project of “Islamization of Knowledge” continues to be of vital importance to the Ummah of Muslims. The future of any community is strongly linked to the education received by the children in that community. Today, the vast majority of Muslim children receive a secular Western education. Built into such an education are assumptions that contradict basic Islamic teachings; for example, the separation of state and religion, based on the idea that religion is a private and personal matter, and should not be brought into the public domain. Because of these conflicts, many Muslim intellectuals have argued for the necessity of assimilating Western knowledge into an Islamic framework. At the dawn of the fifteenth century Hijrah, the Organization of Islamic Conference (OIC) created two universities – the International Islamic Universities of Islamabad and Malaysia – for this explicit purpose. All across the Islamic world, a large number of diverse initiatives have been launched for this purpose of integrating our traditional corpus of Islamic knowledge with modern Western knowledge.

Because of its vital importance, large amounts of individual and collective efforts of Muslims have gone into achieving this goal. While partial success on certain limited fronts has been achieved, it would be fair to assess the overall outcome as a failure. Many of the leading scholars who have spent their lifetimes on this goal have acknowledged this failure, as we will shortly document. Corresponding to this failure, many diagnoses have been offered as to the reasons for this failure. In this paper, our goal is to provide a new diagnosis of the reason for the failure. A correct diagnosis is essential to providing a proper remedy; existing misdiagnoses have not allowed for application of the correct curatives. To summarize briefly, we will argue that there are strong conflicts between Islamic views on the nature and purpose of human existence and Western views. The full extent of this conflict has not been realized by most who have worked on the Islamization of knowledge project. As a result, they have attempted to integrate two conflicting bodies of knowledge, which is an impossible task. This is what accounts for the failure of these attempts.

To keep the discussion sharply focused, in this paper we confine our attention to ‘Islamic Economics’ or the project of Islamizing the Western discipline of economics. The broad principles underlying social sciences as developed in the West, and their conflict with Islam, has been discussed separately in Zaman (2009) “Origins of Western Social Sciences.”

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