Islam, Inequality and Pre-Industrial Comparative Development

32 Pages Posted: 9 Mar 2015

See all articles by Stelios Michalopoulos

Stelios Michalopoulos

Brown University - Department of Economics; Brown University

Alireza Naghavi

University of Bologna - Department of Economics

Giovanni Prarolo

University of Bologna; University of Milan - Centro Studi Luca d'Agliano (LdA)

Multiple version iconThere are 4 versions of this paper

Date Written: November 2014

Abstract

This study explores the interaction between trade and geography in shaping the Islamic economic doctrine and in turn the comparative development of the Muslim world. We build a model where an unequal distribution of land quality in presence of trade opportunities conferred differential gains from trade across regions, fostering predatory behavior from the poorly endowed ones. We show that in such an environment it was mutually beneficial to institute an economic system of income redistribution featuring direct income transfers in return for safe passage to conduct trade. A commitment problem, however, rendered a merely static redistribution system unsustainable. Islam added a set of dynamic redistributive rules that were self-enforcing under large gains from trade and high proportions of arid land. While such principles fostered the expansion of trade within the Muslim world they limited the accumulation of wealth by the commercial elite, shaping the economic trajectory of Islamic lands in the preindustrial era.

Keywords: Religion, Islam, Geography, Inequality in land quality, Wealth accumulation, Public good investment, Trade, Confliict

JEL Classification: O10, O13, O16, O17, O18, F10, Z12

Suggested Citation

Michalopoulos, Stelios and Naghavi, Alireza and Prarolo, Giovanni, Islam, Inequality and Pre-Industrial Comparative Development (November 2014). Centro Studi Luca d'Agliano Development Studies Working Paper No. 377, Available at SSRN: https://ssrn.com/abstract=2572476 or http://dx.doi.org/10.2139/ssrn.2572476

Stelios Michalopoulos

Brown University - Department of Economics ( email )

64 Waterman Street
Providence, RI 02912
United States

HOME PAGE: http://https://sites.google.com/site/steliosecon/

Brown University ( email )

Box 1860
Providence, RI 02912
United States

Alireza Naghavi (Contact Author)

University of Bologna - Department of Economics ( email )

Piazza Scaravilli 2
Bologna, 40126
Italy

HOME PAGE: http://alirezanaghavi.altervista.org/

Giovanni Prarolo

University of Bologna ( email )

Piazza Scaravilli 2
Bologna, 40100
Italy

HOME PAGE: http://www2.dse.unibo.it/prarolo/

University of Milan - Centro Studi Luca d'Agliano (LdA) ( email )

Via P. Amedeo 34
Milano, Mi 20122
Italy

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
14
Abstract Views
481
PlumX Metrics