IJPEE: Special Issue on The Challenge of Islamic Economics

The foreward (excerpted below) identifies three generations of Islamic Economists. To which generation (intellectually) do you belong?

See also: Post on DEFINING ISLAMIC ECONOMICS on IWV BLog which cites Forward

EXCERPTS from the FOREWARD, which characterizes three generations of Islamic Economists:

FIRST GENERATION: Early writings on Islamic

economics focus on comparison and evaluation of economic systems, and proving the

superiority of a hypothetical economic system based on Islam. In particular, two major

figures played a prominent role in promoting the vision of a just and equitable Islamic

Economic system: Muhammad Baqir al-Sadr in his book Iqtisaduna (Our Economy), and

Sayyid Abul-Alal-Mawdudi in numerous books and articles (e.g., Economic System of

Islam). Chapra (2004) and Wilson (1998) summarise this historical background, and also

remark on the courage it took to formulate an Islamic economic system and defend it

against the dominant and apparently tremendously successful Western systems in the

early 20th century.

SECOND GENERATION: The vision of the founders of the field, like Mawdoodi and Baqir Al-Sadr, for an

Islamic Economic system which would provide a just and equitable alternative to both

Capitalism and Communism were abandoned. Second generation pragmatists saw that

the required revolution did not appear to be forthcoming, and more limited goals were

targeted. Instead of rejecting Capitalist institutional structures, the new Islamic

economics (nIE) attempted to tinker with Capitalism in order to make it conform to

Islamic principles. A popular formula for defining the subject became: nIE =

Capitalism – Interest + Zakat. Due to circumstances to be discussed in detail shortly,

second generation authors in nIE sought to reconcile the differences between Capitalism

and Islam that had been seen clearly by the first generation. While acknowledging its

debt to the founders of Islamic economics, the second generation buried first generation

expressions of conflict, and the grand vision of an alternative system, under the carpet.

They asserted that these were mistakes made by founders, who did not have sufficient

understanding of modern economics. This fundamental mistake of the second generation

led the entire field of Islamic economics astray

THIRD GENERATION:function. Zaman (2015b) shows how existing definitions of Islamic economics are

compromises, based on mixing normative Islamic principles with supposedly positive

economic principles. The paper shows that genuine Islamic principles are in direct

conflict with neoclassical economic theory. For example, conventional micro and macro

look at economic issues from the perspective of the individual and the nation. Islam

suggests the need to look at the family, neighbourhood, community, and humanity as a

whole, and explicitly rejects thinking in terms of national interests (or in terms of race,

colour, language and ethnic groupings), as divisive and harmful to the brotherhood of

man. Islam also rejects detached observation of oppression as inhuman, and calls for

action against injustice; thus it is transformative, rather than positive or normative. Islam

calls for simple lifestyles in harmony with nature and with our neighbours, rather than

seeking to outdo each other in increasing luxury. There is heavy emphasis on cooperation

and generosity, in radical contrast with the virtues of competition and selfishness

emphasised in conventional economics. The outcome is that a genuine Islamic economics

is radically different from conventional economics, instead of being a branch of it.

Since the start of the new millennium, the conflicts between Islam and economics, as

described in ‘Islam versus economics’ by Zaman (2015c) are receiving greater

recognition. It also recognised that the epistemological claims of conventional Western

economic theories to objectivity and factuality are false. Recognising the normative status

of conventional theories creates the confidence in the third generation of Islamic

Economists to reject western theories and affirm Islamic principles when faced with a

conflict between the two. All of the writers in this volume, and a great many other

authors in addition, are contributing to the increasingly diverse literature in the third

generation of Islamic economics.