Notes on Islamic Economics

Monzer Kahf

Description

This is the one he wrote "a series of notes about the Islamic economy" consists of 11 chapters, and revolves around, Islamic Economics, What is it and what is it for? .. Further Notes on Definition and Methodology
of Islamic Economics.. The Role of Values, Ethics and Culture in
Economics .. Institutional Structure of the Islamic Economic
System ..Economic Role of State in Islam .. The Role and Importance of the Private Sector ..
The Demand Side or Consumer Behaviour Theory .. Supply Side or Producer Behaviour .. The Institution of Market .. Institutional Guidelines of Market Regulation..Allocation of output to factors of production and the implicit

Sujets

• Islam
• Philosophie et théologie
• ISLAMIC ECONOMICS

Informations

• Publié par: Monzer Kahf
• Date de parution: 01 janvier 2014
• Nombre de lectures: 0
• EAN13: 9796500133867
• Langue: English
• Poids de l'ouvrage: 12 Mo

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Notes On Islamic Economics





THEORIES AND INSTITUTIONS





MONZER KAHF

MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

CopyRights:
AllcopyrightsarereservedtoAuthor
MONZERKAHF
Address: 22Marblehead,Irvine,CA92620USA
Email:[e-mail]




Publishedby:MonzerKahf
Feb.2014

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

THISSERIES

PREFACE

ThisisthefirstinaseriesoffourbooksonNotesonIslamic
Economics.Thefirstbookdealswiththefundamentaltheoriesand
institutionsoftheIslamiceconomicsystem.Itattemptstopresenta
completeandcoherentinstitutionalsettingoftheIslamiceconomic
systemwhichputsitatascientificlevelcomparablewithothersystems
andallowsustoderivepoliciesandguidelinesforgradual
transformationofanyeconomyandforadaptingexistinginstitutionsto
thebasicrequirementoftheIslamiceconomicsystem.

Thesecondbookofthisseriesshallfocusonthethirdsector,
thecharitableinstitutionsoftheIslamiceconomicsystem.Itshall
discussthefundamentalprinciplesonwhichtheIslamiccharitable
sectorisfounded.ItwilldiscusstheprinciplesofZakah,Awqafand
InfaqintheIslamiceconomicsystem,theinstitutionstheycreateand
theirhistoricalapplication.Itwillalsodiscussthenecessary
requirementforefficientmanagementofZakahandAwqafin
contemporaryeconomiesandmeansandmethodologiesforfinancing
therevitalizationofdormantAwqafrealestatepropertiesinthe
Muslimsocieties.

BookthreewilltakeuptheissueofIslamicfinanceandbanking.
ItwillpresentthebasicsketchofIslamicfinancefromtheoreticaland
practicalaspects.ItwillfocusonthenewconceptofIslamicfinancial
intermediationandwilldistinguishbetweendepositoryfinancial
intermediaryinstitutionswhichhaveanimportantmonetaryaspectof
theiractivitiesandotherinstitutionswhichconcentrateoninvestment
activities.

BookfourwilldiscusstheIslamicdevelopmenttheoryand
policy.ItwilldealwiththeobjectivesofeconomicpoliciesintheIslamic
economicsystemandtheinstrumentsavailablefortheirachievement.
ItwilllookintothechangesimplicatedbytheIslamiceconomicsystem
intheconceptandapproachestodevelopment.Thisbookwillalso
covertheIslamicapproachtofiscalandmonetarypoliciesaswellas
incomepolicyanddevelopmentalpolicy.

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

InthesefourbooksIdonotintendtorepeatotherwritings.This
seriesisanattempttopresentIslamiceconomicsinanonͲtraditional
waywithanemphasisontheinstitutionalaspectsandstructure.Iwill
dealwiththefundamentalissuesofIslamiceconomicsandfinanceina
realisticyetinnovativemannerwhileobservingfundamentalrelations,
tiesandinspirationfromthebasicsourcesoftheIslamicreligionandits
Shari’ahrulings;theQur’anandtheSunnah.

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

Introduction

Chapter1

Chapter2

Chapter3

Chapter4

Chapter5

Chapter6

Chapter7

Chapter8

Chapter9

Chapter10

Chapter11

Conclusion

TABLEOFCONTENTS

NOTESONISLAMICECONOMICS

THEORIESANDINSTITUTIONS

Page

ix
IslamicEconomics,Whatisitandwhatisit
1
for?
FurtherNotesonDefinitionandMethodology
19
ofIslamicEconomics
TheRoleofValues,EthicsandCulturein
47
Economics
InstitutionalStructureoftheIslamicEconomic
61
System

EconomicRoleofStateinIslam

TheRoleandImportanceofthePrivateSector

93

119

TheDemandSideorConsumerBehaviour
145
Theory

SupplySideorProducerBehaviour

TheInstitutionofMarket

177

211

InstitutionalGuidelinesofMarketRegulation237
Allocationofoutputtofactorsofproduction
259
andtheimplicit
295

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

INTRODUCTION

ThisisthefirstbookoftheseriesofNotesonIslamicEconomics.
ItpresentsthebasictheoriesandtheinstitutionalsetupofIslamic
economics.Itcoverschaptersonethrougheleven.Theypresentthe
basicideasandtheoriesofIslamiceconomics.Chaptersoneandtwo
attempttoanswerthequestionsof‘whatisIslamicEconomics’and
‘whyweneedtostudyit’,theyalsodiscussissuesofdefinition,scope,
sourcesofknowledgeandrelevance.
Thethirdchapterdealswiththebasicvaluesandethical
questionsofIslamiceconomicsbothasabranchofscienceandasa
studyoftheIslamiceconomicsystem.Itbrieflystudiesethicalvalues
whichaffecteconomicbehaviourofmenandwomenlikeofefficiency,
performance,selfͲreliance,perfectionandbenevolence.Chapterfour
willdiscussthefundamentalinstitutionalsetupoftheIslamiceconomic
system.ItarguesthattheIslamicinstitutionalsetupisbasedonnine
pillarswhichare:1)Propertyrights,2)Exchangeandcontracts,3)
Economicfreedom,4)Marketstructure,5)Wealthandincome,6)State
oflaw,7)Economicactivityofthestate,8)Internalethicalmonitor,
and9)Mercyandcaring.

Thefollowingtwochaptersaredevotedtothediscussionofthe
positionandplaceofthestateandtheprivatesectorinthesystemand
theinterrelationsbetweenthem.Themainargumentofthesechapters
isthatwhiletheIslamicsystemadoresprivateownershipandeconomic
freedom,itassignsanimportantroletothestate,inallitsbranches,
andchargesitwithimportantfunctionsincludingthemanagementof
publicproperties,includingnaturalresources,whichmaybehuge
undercertaincircumstance.

Islamictheoriesofconsumerbehaviourandproducerbehaviour
arediscussedinchapterssevenandeight.Thebasictheoremofthese
twochaptersisthathumanbeingsarenotonedimensional.They
ratherhaveabenevolentfacetoftheirbehaviourswhichispresent
bothintheconsumersandthefirmsaswell.Theanalysisinthesetwo
chapterstriestotakethisbehaviouralelementintoconsideration.

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

Chapterninerevisitsthemarketanddealswiththestructureof
pricesatthemicrolevel.Itarguesthatthemarketreformsintroduced
bytheProphet,pbuh,himselfwereveryexemplaryinsettingthe
desiredstructureforthemarketonthebasisoffairplayofmarket
forcesofdemandandsupplywithoutelementsofinjusticewhichmay
comefrommonopoly,financialpower,unethicalpracticesbysome
actorsorinsufficientpowerofenforcementofexchangecontracts.At
thesametimetheIslamicmarketstructuredoesnotassumeconditions
ofperfectcompetition.

Thelasttwochaptersaredevotedtodiscussingtheeffectof
marketstructureonthefactorsofproductionandontheallocation
processofresources.Theyalsodiscussregulationsinthemarketand
theirextentandeffect.

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

CHAPTERONE
ISLAMICECONOMICS,WHATISITANDWHATISITFOR?

WhatisIslamicEconomics?Doesitexist?Whatisthesubjectof
IslamicEconomics?Thesearethreeintroductoryquestions
understandingthemwillfacilitateourstudyinthefollowinglectures
anddiscussion.

Tobeginattemptingtoanswerthefirstquestionwemustfirst
knowwhatEconomicsitselfis,asabranchofscience,studiesand
researchsinceIslamiceconomicsisalsoeconomicsanyway.

WhatisEconomics?
Economicsisthestudyofhumanbehaviour,actionsand/or
practicesinutilizinglimitedresourcestosatisfyunlimitedwants.Itisa
socialsciencewhichstudieshumanbehaviourindealingwithwealth,
property,resources,incomeandthelike.

Mainobjectivesofanyreligion

Everyreligionisconcernedwithtwomainobjectives;deedand
creed.Everyreligion,fromthebehaviouralangle(thedeed),isfocused
onformulationorreͲformulationofhumanbehaviourtomake
compliantwiththemannerwhichisdesiredandprescribedbyreligion.
Thus,religion,incontrasttoeconomics,dealswiththeholistichuman
behaviour(doanddon’tdo)inutilizingresourcesofallkinds,notonly
materialresources,tosatisfywants,desiresandotherobjectivesin
humanlife.Religionisthereforefocusedonhumanbehaviourinits
totality,itisbroaderthaneconomicsitself.Itdealswiththeuseof
resourcesefficientlyandcoversotheraspectstoothatarenotcovered

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MONZERKAHFͲISLAMICECONOMICS:THEORIESANDINSTITUTIONS

ineconomics.Inthesecondsourceofreligion,theSunnah,the
prophet,pbuh,isreportedtohavesaid:thetwofeetofaservantof
Allahwillnotmove(remainstanding)ontheDayofJudgmentuntilhe
isquestionedabouthislifehowhespentitandabouthisknowledge
howheutilizeditandabouthiswealth/propertyfromwherehe
acquireditandinwhatwayhespentitandabouthisbodyastohow
ﻢﻴِﻓ ِﺄﺴﻳ ِﺔﻣِ ْمﻮﻳ ٍﺪﺒﻋَ ُ
ِهﺮﻤﻋ ﻦﻋَ َ
heuseditَ