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Islamic economics and its comprehension

Mohammed Al Balushi

By Mohammed Al Balushi | Oman Observer | 25 Apr 2012

Economics, regardless of whether it is micro economics or a macro, is a subject which needs to be understood from the roots to its branches. Economic is the subject which does not differ from one religion to another. It is a subject which fits all societies. It is the need of all human beings.

No matter if you are a president or an ordinary person from the same state. No matter if you are a true Muslim or belong to any other respected religions. It does not even matter if you are an atheist. Economics as a subject is essential for all of you, because no one can survive without a piece of bread.

Understandingly, Islam is the religion which covers all aspects and elements of life. Practically, how does Islam look and apply economics for a better life? According to Islamic literature Islamic economics began with the advent of Islam, which means fourteen centuries ago. Some Islamic books does highlight that. Quran, however, doesn’t explain in detail the fiscal policies but there are some economic teachings and guiding principles which determine such policies. However, the necessary details and teachings were classified by Prophet Mohammed, (PBUH). In early Islam, the main sources of income were zakah, jiziya, and khumus. In those days whatever was collected in the shapes of (zakah, jiziya, and khumus) were equally distributed to the public (needy people). The second caliph Umar had justified the taxes by saying; “Taxes are justified only when they are collected in a just and legal way and they are spent justly and legally”.

In the current world, how the sunnah and sharia assist in formulating principles for fiscal operation? How does modern Islam and Muslims see economic in its true Islamic way and principle? Today, is the collection of zakah taking place appropriately? And is the distribution equally and justly done to the have-nots in the society in the world of Islam? Unfortunately, all such practices are not mostly seen in todays Islamic world. Economically, there are many good lessons from Islam, if applied many economic issues may get reduced. In many Islamic countries the proper distribution of wealth is lacking. One of the economists have said; “There is no underdeveloped country in the world, but there are some areas in the same country which are not developed by the ruler”. In the same way, you find one person is a billionaire while the other is penniless in the same country and within the same area.

Before the conclusion, in my personal opinion I would say that it is not the religion which makes a good economic policy or a worse one. It all depends on you as an economist and explaining everything in an economic way. For economists things are meaningless if they are not translated into economic language. Suppose you are a film-maker and spend more than six months to complete the film. The film gets completed successfully. As an economist I am not interested how many days you have spent, where you went for shooting, what lighting methods you have used, what obstacles you have faced, instead, I am more interested in how much amount you have spent, what was your budget, and how much you have made as a net profit. Suppose you are a novelist and published some hundred books. As an economist I might not be interest in reading all of your books, because, these are not yet translated to me in an economical language.

But, I am very much interested to find out how many books were sold and read by people.
Individually, what is your contribution toward economics? How much do you produce per hour, per day, per week and per month? Once, you understood your productivity level and the value of it, then; it means you are on the right path, economically.

Whenever, there is a conversation on economy, Adam Smith, the father of economy always comes to peoples’ mind. He stated in the Wealth of the Nation his famous book, that labour of every nation is the fund which originally supplies it with all the necessaries and conveniences of life which it annually consumes, and which consist always either in the immediate produce of that labour, or in what is purchased with that produce from nations. This indicates that nations are producers and at the same time the consumers. It is the nations who produce materials and consume at the same time.



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