Economics and Business

The Islamic Vision of Development in the Light of Maqasid al-Shariah

The ultimate goal of all Islamic teachings is to be a blessing for mankind. This is the primary purpose for which the Prophet (SAAS) was sent to this world (Qur’an, 21:107). One of the indispensable ways to realize this goal is to promote the falah  or real well-being of all the people living on earth, irrespective of their race, color, age, sex or nationality. The word falah and its derivatives have been used 40 times in the Qur’an. Another word, fawz, which is a synonym of falah, has also been used 29 times along with its derivatives. This is also the goal towards which the muezzin calls the faithful five times a day, showing thereby the importance of falah in the Islamic worldview.

Islamic Justice In A Monetary System: A Modest Proposal

Dr. M. Umer Chapra. Towards a Just Monetary System. Leicester: The Islamic Foundation. 1985. 292p.

Extensive literature on the institutional aspects of monetary economics includes pioneering studies by Muhammad Uzair, Muhammad Nejatullah Siddiqi, Ziauddin Ahmed, Anwar Iqbal Qureshi, Afzalur Rahman, and the Council of Islamic Ideology in Pakistan among many others. Scores of research papers have elaborated the functioning of Islamic banking in theory and practice. A fresh study on Islamic banking in Iran and Pakistan by Zubair Iqbal and Abbass Mirakhor has been released by the International Monetary Fund. In the voluminous literature on issues dealing with money and banking in Islam, Towards a Just Monetary System is outstanding in many respects.

The Prohibition of Riba in Islam: An Evaluation of Some Objections

A number of objections have been raised against the prohibition of Riba (interest) in Islam and it has been alleged that a riba-free economy will face so many problems that it may not be able to survive. This paper evaluates the nature and significance of some of the major objections and, in the process, also indicates the rationale behind the prohibition of riba.

ALLOCATION OF RESOURCES

One of the objections raised against an interest-free economy is that it will not be able to bring about an optimum allocation of resources. The reason given for this is that interest is a price and like all prices it performs the function of allocating 'scarce' loanable funds among the 'infinite' users of such funds in an objective manner on the basis of ability to pay the price. If the demand for, or supply of, loanable funds changes, a new equilibrium is reached at a different rate of interest.

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