Islamic economics is said to be corollary of the post-1960s reforms in the Muslim societies that were looking at the ‘failure’ of mainstream, western development models in the Muslim world. Focusing on the “Islamic’ ontology based on the guidance of Qur’an and the Sunnah, there was an attempt to resolve the challenge and build an alternative model of socio-economic development that attends both the needs of a community-based, shared value system as well as fulfils the religious obligations that are promised to be rewarded in the life hereafter. Hence, a bi-focal approach was adopted to place utmost importance in sharing one’s wealth with others who are needy in the community as well as to consider the worldly resources only as a ‘privilege’ and not as a ‘right’ to exploit them further for individual profits and wealth accumulation. Thus the ‘social- welfare’ or ‘social good’ were the cornerstone of the Islamic economics or social development framework wherein the attainment of Falah – “prosperity in this world and the hereafter.”
Islamic economics redefines the concept of individualism, personal right to property or wealth creation and replaces it with a strong sense of social justice and equity. It abhors accumulation of wealth in few hands while neglecting the large number of poor and needy in the society. Following the basic principles and guidelines of the Shariah it values obligation to Allah and the fellow human being in the society and trie4s to attain salvation (Falah) common good, shared ‘prosperity’ and mutual ‘welfare’ by adopting economic activities around social cooperation and participation of all. It considers wealth or any resources at the command of an individual as a Amanah – held in trust for all and thus gives a completely welfare and equity oriented perspective to the economic activities of the world.
Islamic economics can thus be seen as a moral economy wherein an ethical approach is followed to strengthen the idea of equality of individuals in the eyes of The Almighty who has bestowed all the resources of the world for the common benefit of all. In a way it sits upon the idea of tawheed – the unity of Allah. The modern values like ‘social accountability’, Islamic economics takes a higher moral ground by assigning accountability in the eternal other world - the life hereafter. Through the process of Ihsan or benevolence for others, a moral compass of the Islamic economics is pointed towards a journey that individuals must undertake to towards attaining Falah. Moreover, Islamic economics is in tandem with moral economics in as much as it emphasises social justice and magnanimity (Ihsan) to achieve equality between all living the society. Hence, individual (economic) development is juxtaposed with the social, environmental and a collective development and growth of the society and the world.
We can, therefore say that Islamic
economics adds a ‘moral filter’ to the economic activities in this world with
rewards for sharing resources with others in the society in the world
hereafter. In this sense Islamic economics can be considered as a moral
economy.
