This article reviews the shari’a approach to markets and examines its treatment by certain twentieth-century Islamic economists such as Nejatullah Siddiqui, Nawab Haider Naqvi, Umer Chapra and M.A. Mannan. It characterises the arguments of these economists as largely statist, redistributive and socialist, possibly reflecting post-colonial intellectual experiences. Yet shari’a endorses negative freedom by proscribing price controls and guaranteeing consumer protection from coercion. Islamic law, this article argues, as evinced in both revealed knowledge and human exegesis, has endorsed a market-friendly, libertarian and limited-government philosophy.
Islam is not just the world’s fastest-growing religion, governing more than a billion lives; it is also the most potent political currency in the world’s economically most strategic areas. Prosperity and peace in these areas depends largely on the degree of legitimacy that free market economics would enjoy in an increasingly reactionary ideological environment underpinned by specific religious interpretations. Seen in this way, the question of the compatibility of free market economics with Islam has global implications.
This article discusses the compatibility of free market economics with shari’a by juxtaposing literature from the Quran, hadith and fiqhagainst the arguments of certain twentieth-century Islamic economists and scholars. Unlike most modern treatments of Islamic economics, the article does not seek to compare and contrast Islamic law with prevalent discourses on economics that have resulted in ‘Islamic capitalism’ or ‘Islamic socialism’. Rather, it revisits the intellectual tensions within Islamic discourse by discussing the ideas of economic freedom and social justice, and aims to show that, at least in the domain of economics, the goal of justice is largely achieved by ensuring freedom.
The article suggests that it is important to rediscover the economic insights offered in the earlier Islamic texts, but not in search of some pure type of economic system, for no such system exists. Rather, the quest should be for an historical understanding of certain intellectual positions that draw their authority from Islam and continue to influence the domain of public policy in Islamic countries. Such analysis is especially important in relation to countries like Pakistan, whose constitution is officially subject to the boundaries prescribed by shari’a.
The second section of this article presents the basic principles of economics found in the primary sources of shari’a, namely the Quranand hadith. The third section presents the key arguments of certain twentieth-century Islamic economists on the issues of economic freedom, welfare and social justice. The fourth and concluding section restates the salient characteristics of Islamic economic philosophy.
2. The principles of economics in Islam
This section presents the important principles and features of economics in Islam derived from the Quran, hadith and fiqh. Admittedly, what follows by way of evidence will be selective, but it is hoped that the primary nature of these verdicts, being based directly on the Quran and hadith, will help in substantiating the argument. As this discussion shows, the economic system of an Islamic state ought to be based on the principles of freedom, mutual consent and exchange. In terms of policy, this leads to the affirmation of private property rights, the absence of price controls and the endorsement of a risk–return conceptualization of wealth creation.
2.1. Voluntary exchange
The fundamental principle of economic transactions is captured in the following Quranic verse, which enjoins its followers to observe voluntary exchange and thrift.
Believers, do not consume your wealth among yourselves in vanity, but rather trade with it by mutual consent. (4:29; trans. Dawood 1999)
Another leading translator and interpreter of the Quran, Abdullah Yusuf Ali, has translated the same verse thus:
O ye who believe! Eat up not your property among yourselves in vanities; but let there be amongst you traffic and trade by mutual good-will. (4:29; trans. Ali 1934, p. 53)
Commenting on this verse, Ali writes, ‘Here it occurs to encourage us to increase property by economic use (traffic and trade) recalling Christ’s parable of Talents (Matt 25: 14–30), where the servants who had increased their master’s wealth were promoted and the servant who hoarded was cast into darkness’ (1934, p. 54). This verse should form the ethical and moral foundations of the economic policy of an Islamic state as it combines the basic sources of prosperity, namely, property, thrift and exchange.
2.2. Acceptance of inequality as a divine scheme
The Quran enjoins its followers to accept socio-economic inequality as a part of the divine scheme. Thus, inequality in its own right may not be construed as tantamount to an injustice. The Quran is explicit on this point at several places, for instance:
It is we who deal out to them their livelihood in this world, exalting some in rank above others, so that one may take the other into his service. (43:32)
Commenting on this verse, Abdullah Yusuf Ali writes, ‘In his wisdom, God allows some to grow in power or riches, and command work for others, and various relative gradations are established (1934, p. 347)’. It shows that in terms of socio-economic status, Islam not only condones inequality but attributes it to a divine scheme.
2.3. Sanctity of property rights
The sanctity of private property rights is derived from extensive Quranic injunctions on inheritance and charity, mentioned on a number of occasions. Although this remains an inference, a more direct verdict in favour of protection of private property can be found in the last sermon of the Prophet, which he began with these words:
O People, just as you regard this month, this day, this city as sacred, so regard the life and property of every Muslim as a sacred trust.
2.4. Free trade
The Prophet of Islam, himself having led the life of an active trader for 40 years, had permitted trade even with the enemy. In a state document issued during the time of the Prophet, the Prophet issued a writ of protection from ‘God and Muhammad’ in favour of Yuhannah ibn R’bah and the people of Ailah, for trade via sea and land. It should be noted that before that writ was issued the said tribes and their lands had been subdued and annexed by the Prophet (Yusuf 1990).
2.5. Price control
The issue of tas’ir (price control by the state) has exercised Islamic jurists for centuries. The Quran is silent on it, and we are therefore left with hadith – the traditions of the Prophet Muhammad – as a benchmark for understanding religious notions about price control within the Islamic framework. According to a tradition of the Prophet, tas’ir is forbidden, as it is an injustice and as prices are determined by God. Various ahadith convey the same meaning and message, and are recorded in all leading compilations of ahadith except Sahih Bukhari. According to a hadith:
At the time of the Messenger of God, the market price rose in Medina. The people said, ‘O Messenger of God, fix the price’. He replied, ‘God is the taker and the disposer, the provider, and the controller of prices. I hope that when I meet Him none of you will have a claim against me for an injury concerning life and property’. (Al-Tirmidhi on the authority of Anas ibn Malik)
There is a general consensus among the four leading schools of thought in the fiqh of the sunni Islamic tradition to the effect that price control is proscribed in Islam, although some interpretations have sanctioned intervention in order to protect consumers. The shi’atradition also legitimizes the prohibition on state intervention in price setting, although the hadith narrated in shi’a literature is different. Accordingly, when the price of goods fluctuated considerably, the Prophet was requested to set a price. The Prophet reportedly said:
I will not set such a precedent, let the people carry on with their activities and benefit mutually; if, however, you wish to give them advice, that will not be objectionable. (Va’ezzadeh Khorasani, quoted in Nomani and Rahnema 1994, p. 58)
Islamic jurists had clearly understood the consequences of price control. Imam Shamsuddeen Ibn Qudamah al-Maqdidi (d. 1304), a Hanbali jurist, argued against any kind of state intervention in the market. He wrote:
In a way the control of price may give rise to price rise. The traders from outside will not bring their goods in a place where they would be forced to sell them at a price against their wish. The local traders would hide the goods instead of selling. People would have less than their need, so they would offer a higher price to obtain the goods. Both parties (sellers and buyers) would lose; the sellers because they were prevented from selling their goods, and the buyers because there were prevented from fulfilling their needs. So this act will be termed as forbidden. (Ibn Qudamah, quoted in Bashar 1997, p. 32)
Ibn Qudamah clearly understood two harmful effects of price control: the emergence of black markets, and unsatisfied consumer needs. Thus, for this school consideration of the needs of both sellers and buyers shows that price control reduces welfare.
2.6. Profit and wealth creation
A market price always contains a profit margin for the seller; and it is an established tenet of commerce that higher risk entails higher profit. What constitutes profit? A very comprehensive hadith identifies the crux of profit in these terms:
Profit earned depends on the degree of risk assumed. (Sunan Abi Dawood, quoted by Usmani 2010; author’s translation)
This implies that Islamic law does not define any quantitative upper limit on the degree of profit to be earned, but ties it to the degree of risk assumed. Of course, in a competitive economy any trader taking extraordinary profits in commodity markets would soon find new suppliers offering the same goods at a lower price.
2.7. Muhtasib: Consumer protection and enforcement of contracts
The early Islamic state saw the appointment of an officer, muhtasib, or the organisation of hisba (business accountability), in the city markets, largely for the purpose of inspection and regulation. The first muhtasib in Islamic history was Umar, one of the most trusted companions of the Prophet and the second Caliph of Islam, who was appointed by the Prophet himself. Essentially, the Prophet delegated the tasks of visiting the markets for the purpose of inspection and weight measurements to Umar. However, as established, price fixing was beyond the jurisdiction of the muhtasib (Dost 2009). Later, another noted Islamic scholar, Al-Mawardi, elaborated the duties of the muhtasib. For him, ‘the market supervisor (muhtasib) is simply a coordinator of marketplace on the principles of “enjoining the right and forbidding the wrong”1. His functions pertaining to the economic realm included inspecting measures, the quality of products, and the integrity of contracts in the market (Dost 2009). His other duties included dealing with ‘market rigidities such as bay al-gharar (speculative sales), najsh, price discrimination, monopolistic practices, collusion, dumping, hoarding of necessities and others’ (Oran 2010, p. 134). A muhtasib was authorised to give advice, issue reprimands, obstruct by force, threaten, imprison, or even expel individuals from the market.
2.8. Economic freedom and the concept of welfare in Islam
The foregoing discussion establishes that Islam ordains an environment of economic freedom with minimum state intervention. In principle, economic freedom is guaranteed and there is a strong rationale for believing that it is the economic freedom of both buyers and sellers that constitutes the central pillar of Islamic economic policy. The natural question that arises is that, if this conclusion is accepted, then what does Islam offer to the weak and the poor? How can a regime that is supposedly non-interventionist by design fulfil its obligations towards those of its citizens who are poor, excluded or marginalised?
It is argued that the welfare that forms the central concern of an Islamic state comes not from controls and distribution but from liberty, enterprise and charity. As the introduction of hisba suggests, the Islamic state ensures consumer protection from theft, fraud or coercion through both legal and moral obligations. Thus, the protective aspect of an Islamic state is essentially focused on ensuring the absence of harm rather than the provision or redistribution of goods; it is negative rather than positive.
Thus, the economic policy of shari’a can arguably be understood as a validation of the notion of negative freedom. The concepts of negative freedom and positive freedom were articulated by Isaiah Berlin (1958). Negative freedom means freedom from coercion, whereas positive freedom means freedom to act. J. S. Mill (1859) and F. A. Hayek (1960) advocated negative freedom as a principle of public policy. It was argued that if the state could protect its citizens from coercion in any form, and from any party, it almost guaranteed their welfare without directly providing for it.
There is no doubt that Islam calls for compassion towards others, but this call is essentially moral and voluntary in nature; otherwise, the example of mu’akhat set by the Prophet and his worthy companions upon hijrat, wherein the Muslims of Medina shared and gave up half of their property to their brethren migrating from Mecca, would have been codified into a law, which would have prescribed that any surplus property owned by a Muslim should be given to a needy brother or neighbour. But this brotherhood remains voluntary in nature, and is not legally enforceable. The forcible appropriation of property is by general consensus regarded an injustice, a zulm. So the notion of forced redistribution seems alien to Islamic law and the spirit of its injunctions.
In summary, the institutional proscription of price control and the ensuring of consumer protection at the same time constitute the two most important elements of the Islamic market. It may be inferred that the letter of shari’a calls for economic freedom but its attendant systems of consumer protection and free and fair competition provide the foundation of social justice. Seen this way, Islam provides its followers with a firm moral foundation for economic transactions.
3. Islamic economics: signposts to statism
This section reviews some of most important topics that are generally debated in Islamic economics. It revisits the arguments of certain leading Islamic economists of the twentieth century,2 such as Nejatullah Siddiqi, Syed Nawab Haider Naqvi, M.A. Mannan and Umer Chapra. It raises the fundamental question of whether an Islamic economy is plan-based or market-based. It also discusses some of the important methodological assumptions of Islamic economics, such as ‘Islamic man’.
3.1. Is an Islamic economy plan-based or market based?
In an in-depth and comprehensive review of various strands of Islamic economics, Nomani and Rahnema (1994) have analysed all the major tenets of Islamic economics. They argue that the primary sources of shari’a – the Quran and hadith – legitimise the concepts of a free market economy, whereas the secondary sources, and in particular those developed in recent decades, legitimise a planned economy. In fact, Nomani and Rahnema (1994, p. 55) concede that:
. . . an economic system built on the strict letter of the [Islamic] law would resemble a perfectly competitive market system. This will be called the ‘Islamic market mechanism’. An economic system rigidly built on the equitable spirit of the law would resemble an egalitarian system in which the plan would have to become the coordinating mechanism of the economy. This will be called the ‘Islamic plan mechanism’.
The authors cite leading jurists and scholars in support of this seemingly self-contradictory and incoherent finding. However, in the final analysis they seem to incline towards a planned economy by stressing the secondary sources. This is evident in their solution, which they call the ‘Islamic plan-then-market mechanism’ (1994, p. 55). Thus, it is likely that, despite the unambiguously libertarian principles of Islamic economics, the authors have been influenced by modern historical and intellectual developments resulting in socialist and statist philosophies.
Nomani and Rahnema (1994) also believe that the primary aim of an Islamic government is to meet the basic needs of the poor. However, a contrasting ‘aim’ is found in Islam’s traditions and medieval understanding: ‘Easing production and distribution of commodities is the most important objective of exchange in the shari’a’ (Ibn-e Ashur, quoted in Bashar 1997, p. 40).
Nomani and Rahnema (1994, p. 65) hold that, once a state has achieved the goal of tending to the poor, it can afford the luxury of adopting a free market: ‘According to the plan-then-market coordinating mechanism, during the post-need-fulfilment phase, having established social justice, the Islamic economy can then go back to the letter of the law by adopting the Islamic market allocation, distribution and reward.’ Thus they call for a planned transition from the state to the market-based system. However, they seem unaware that once the genie of planning is out of the bottle, it becomes impossible to limit it to any specific time or scope. This genie grows mechanically over time, in the form of state bureaucracy, and by the force of its own inertia tries to envelop everything. Those Islamic economists advocating social coordination in the name of social justice seem unable to understand how bureaucracy permeates the very fabric of human life and perpetuates rent seeking.
M.A. Mannan, a pioneer of Islamic economics, captured the gist of his discipline thus: ‘In an Islamic economy, the heart of the problem lies not in the prices offered by the market, but in the existing level of inequality of income’ (Mannan 1984, p. 140). This passage aptly reflects the tension between economic freedom (price) and social justice (inequality). Islamic economics has concerned itself with the causes of poverty rather than the causes of prosperity. It discusses wealth redistribution more enthusiastically than wealth creation, which suggests that modern Islamic economists understand shari’a to sanction a plan-based economy and to focus on reducing income equalities.
Consider, for instance, Syed Nawab Haider Naqvi (2003, p. 15), another towering figure of the discipline who has argued in favour of forced redistribution of wealth, claiming such a policy Islamic. He writes that:
for Islamic moral values to become a source of social binding, Muslim societies must be re-organized on the basis of human freedom, social justice and a commitment to help the poor and the needy by restoring to them from the wealth of the rich what is morally and legally theirs as a matter of right.
Naqvi is not alone in conflating moral injunctions of charity with the legal principles. In fact, he led an important official commission set up at the advent of the Islamisation of the economy in Pakistan. To cite another example of this conflation, it is instructive to see how this commission defined the private property from a so-called Islamic perspective. The commission, following in the footsteps of most Islamic economists, developed the argument that in Islam, ‘all wealth belongs to Allah’ and ‘man is only a trustee of whatever he has and not its owner’ (Naqvi et al. 1980, p. 3). This argument has been used consistently to negate the central tenet of private property. However, it should be obvious that as owners we take all the decisions to acquire or dispose of property but we always undertake it under a law – whether secular or divine. We do not ask the lawgivers to complete such transactions on our behalf. The same commission even suggested the introduction of an inheritance tax – of up to 30 per cent – for non-family heirs over and above the explicit Quranic code of distribution of inheritance among legal family heirs. Isn’t the suggestion of this tax to include non-family heirs a case of playing God?
3.2. Can the market be held accountable for distributive justice?
Mainstream Islamic economists treat distributive justice as a touchstone of economic policy. Like socialists, these economists would hold the market responsible for poverty and inequality. They view private ownership as exploitative. They confound the moral injunctions of the Prophet with canonical law. For example, in expounding his theory of social justice, Ahmad Hassan (1971) relies on Imam Ghazali (d. 1111), a leading Muslim jurist of the medieval era. According to Hassan, Al-Ghazali defined five fundamental human rights, namely, rights to the protection of religion, of life, of reason, of posterity and of property. This list clearly calls for an essentially protective, not a distributive, policy on part of the state. Imam Ghazali advocated the notion of ‘negative freedom’. But this point is lost on our friends. Indeed, Hassan (1971, p. 212) so distorts Al-Ghazali’s reasoning as to argue that ‘the Quran insists on providing the basic necessities of life to all the members of the Muslim society’. As a matter of record, the Quranic text contains no such injunction. Sadly, some Islamic economists do not even spare the Quran in trying to bolster their arguments.
While Hassan may be regarded as an extreme example of an Islamic socialist, writing in the heyday of communism, the role of justice in economic policy confuses even those scholars who have otherwise established freedom of trade as an ‘over-riding factor of the shari’a’sprice control rulings’ (Kamali 1994, p. 26). Consider this passage by the same author.
Justice is the cardinal duty, indeed the raison d’être, of the [Islamic] government not only in its retributive sense of adjudicating grievances but also in the sense of distributive justice, of establishing equilibrium of benefits and advantages in the community. (Kamali 2008, p. 7; emphasis added).
Kamali’s distributive justice is a far cry from retributive justice, and a far cry from the essence of Islam’s message on economic rewards. How can a system guaranteeing freedom of trade ensure an ‘equilibrium of benefits and advantages’? Freedom ought to result in unequal benefits, and as we know, inequality is a permissible, even desired, state in an Islamic economy. The essence of justice is freedom, not equality. This relationship between liberty and justice was best established by Ibn-e Khaldun, the best-known medieval Islamic scholar for founding sociology and for his masterpiece, Muqadimmah. He wrote, ‘Whoever takes someone’s property, or uses him for forced labour, or presses an unjustified claim upon him, it should be known that this is what the Lawgiver had in mind when He forbade injustice’.3 The Islamic economist Muhammad Abdul Mannan writes: ‘Market prices may not enable all the potential consumers and producers to enter into the market’ (Mannan 1984, p. 136). He is right about this, but in fact prices function as means of expression of preference. Like most Islamic economists, Mannan also confuses the concept of freedom with the concept of ability.4 Freedom is essentially determined by the absence of coercion, particularly coercion from lawful authority, but also coercion from other humans. If a person lacks the ability, or the favourable circumstances, to enter a market, then this is not due to coercion. Just as Ibn-e Khaldun elaborated, the spirit of justice is the absence of coercion.
Not all Islamic economists have expressed reservations about the institution of the market. But it is noteworthy that those who favour the market come from non-economic backgrounds. Consider these foundations of the Islamic economy elaborated by S.M. Yusuf, a professor of Arabic: (a) no corner market (that is, no hoarding); (b) no hoarding of gold and silver; (c) no price controls; (d) no restrictions on trade5; and (e) the maintenance of the gold standard (Yusuf 1990, p. 40). Note that Yusuf’s understanding of an Islamic economy is ‘negative’ in character, a spirit much closer to the original, least restrictive attitude towards the market.
3.3. The moral engineering of the individual: The predicament of Islamic economics
Muhammad Nejatullah Siddiqi is one of the most important authorities on Islamic economics in the modern age. For him, Islamic economics questions some of the fundamental assumptions of modern economic theory, for instance about human behaviour that is understood as equivalent to self-interest. According to Siddiqi (2001), Islamic economics would be built on the transformation of individual behaviour. Human behaviour has emerged as a favourite topic of discussion among Islamic economists. They rightly know that without the transformation of the individual into Islamic man, free of selfishness, the dream of an Islamic economy, living up to its own ideals, will not materialise. In other words, Islamists envisage nothing short of social engineering to purge impure human beings of their illicit desires. For instance, another popular Islamic economist, M. Umer Chapra, recognises the efficiency of the market strategy but believes that human beings need to be reformed (Chapra 1993, p. 127). However, in this presumptuous approach towards the individual lies a possible predicament for Islamic economists: how to change human nature first? Thus, Islamic economists build the foundations of Islamic economics on the assumption of specific human conduct instead of certain methodologies and principles.
The foregoing analysis has sought to show that while shari’a calls for the establishment of an order of economic freedom based on mutual consent and stringent consumer protection measures, the modern discipline of Islamic economics seems to have drifted in the opposite direction. With few exceptions, mainstream Islamic economics prefers to discuss poverty instead of wealth creation, income differences rather than prices, and the role of the state rather than the role of the market. Notably, Islamic economics is built on the assumption of an imaginary ‘Islamic man’ who responds to different incentives from those that motivate ordinary human beings. This approach has essentially developed an intellectual framework that provides a spiritual justification of both market-based and plan-based economies without necessarily taking a clear position on principles, methodology and legal framework. However, the general tone of modern Islamic economics remains statist and redistributive. The discipline of Islamic economics that originated in the twentieth century exhibits strong distributive and socialist tendencies in its epistemological assumptions and policy prescriptions. Thus, Islamic economics has shown intellectual leanings towards social justice as a touchstone of economic policy. This has influenced Muslim public opinion and encouraged the largely unelected rulers of Muslim countries to follow predominantly statist, redistributive and even socialist economic policies.
On the other hand, the tradition of Islamic jurisprudence, and in particular its rulings on economic policy, has endorsed a market-friendly, liberal and limited-government philosophy, though subtle and important differences remain between various schools of thought. If the jurists generally stood for economic freedom, why have redistributive tendencies crept into the work of modern Islamic economists?
The classical jurists of Islam are separated from their modern counterparts by the sharp historical wedge that is known as colonialism. The rise of Islamic economics, against the backdrop of a resurgence of the Islamisation of knowledge, is essentially a twentieth-century phenomenon that invites comparison with the gaining of independence on the part of a majority of Muslim countries or their defeat at the hands of Western powers. That has led to the creation of novelties like Islamic socialism or Islamic capitalism, whereas the economic exegesis of the medieval Muslim jurists is free from any such epistemological apologies.
The original spirit of Islamic economic policy as expounded in shari’a was protective, non-interventionist, and non-redistributive in character. It looked on market participants and especially traders as benign ‘trustees of God on earth’, and prescribed legal restrictions on the state discouraging its intervention in markets. The conclusion of this article is that Islamic law, as demonstrated in both revealed knowledge and human exegesis, has endorsed a market-friendly, liberal and limited-government philosophy, which we may characterise as libertarian.
Islam was introduced by a Prophet, who led an active life as a merchant for 40 long years and who is reported to have said: ‘Welfare and blessedness is composed of ten parts, nine-tenths of which is attained through trade.’ This is possible only if the economy is organised on enterprise-centric rather than state-centric lines. The letter of shari’a guarantees economic freedom, and its spirit enjoins social justice. The spirit of welfare, which Islam propagates, is based on the degree of choice and freedom that individuals enjoy, and is dependent on the absence of coercion. Welfare does not come from a big state; it comes from prosperous and responsible individuals who imbibe the notion of mutual goodwill and charity towards others.
The Quran makes it categorically clear that what an individual receives flows either from his own efforts or from God’s bounty, a favour he does not necessarily deserve. The Quran says ‘Man can have nothing but that he strives for’ (53:39). And on many occasions it mentions the Lord’s bounty as a favour from Him. For instance, it says, ‘Allah may reward them [according to] the best of what they did and increase them from His bounty. And Allah gives provision to whom He wills without account’ (24:38). A hadith says that our faith swings like a pendulum between fear and hope; likewise, our sustenance, our economic achievements, oscillate between our effort and our luck. For intellectual convenience, this comes very close to a Misesian understanding of human effort and human design.
Let me finish this article with a sober reminder from Bastiat, who began his treatise The Law, first published in 1850, by treating human life – physical, intellectual and moral – as the sole gift from God, whose preservation, development and perfection is our responsibility.
God has given to men all that is necessary for them to accomplish their destinies. He has provided a social form as well as a human form. And these social organs of persons are so constituted that they will develop themselves harmoniously in the clean air of liberty. Away, then, with quacks and organizers! Away with their artificial systems! Away with the whims of governmental administrators, their socialized projects, their centralization, their tariffs, their government schools, their state religions, their free credit, their bank monopolies, their regulations, their restrictions, their equalization by taxation, and their pious moralizations! . . . And now that the legislators and do-gooders have so futilely inflicted so many systems upon society, may they finally end where they should have begun: May they reject all systems, and try liberty; for liberty is an acknowledgement of faith in God and His works. (Bastiat 2007, p. 58)
Such is the design of the Mighty One, the all-knowing.
Author: Ali Salman (Islam and Liberty Network)
- To translate ma’ruf and munkar as ‘right’ and ‘wrong’ makes them relative.The original sense of ma’ruf is ’urf,‘practice’ or ‘norm’ (Muhammad Khalid Masud, email conversation, 4 May 2012).
- While the tradition of applying Islamic principles to trade and finance is as old as Islam itself, a distinct discipline of ‘Islamic economics’ emerged only in the twentieth century. For the purpose of this article, therefore, the benchmark for discussion is this modern discipline. According to Dr Ayub Mehar, the term ‘Islamic economics’ was first used by Shah Wali Ullah, an eighteenth-century leading Islamic philosopher based in India (personal conversation with the author, 2 May 2012).
- Ibn Khaldun, http://sunnahonline.com/ilm/seerah/0033.htm
- Amartya Sen (1999) should be given credit for creating the deep confusion between the concepts of freedom and capability. He believes that if a person is poor then he is not free.
- During the course of the research for this article, I have been struck by the evidence of free trade even with enemies (except in arms and weapons) during the Prophet’s time.
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