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A Critical Assessment of Islamic Economics

16 Pages Posted: 22 Jul 2004  

Rasul Shams

Hamburg Institute of International Economics

Date Written: 2004

Abstract

This paper presents a critical assessment of the widely discussed concept of Islamic Economics. The two different interpretations of Islamic economics, as the study of the functioning of an interest-free economy, and the validity of moral values in the economy are discussed. It is shown that none of these interpretations can help to create an acceptable foundation for an Islamic economics. Far away from laying the foundation for such an economics the question is raised how an Islamic economy would function, based on the Islamic principle of controlling the Nafs. Microeconomics and macroeconomics of such an economy are analysed, and its special features are compared to an economy functioning on the basis of laws devised by the conventional economic analysis.

Keywords: Household behaviour, unemployment, moral values, Islamic

JEL Classification: D10, E24, P50

Suggested Citation

Shams, Rasul, A Critical Assessment of Islamic Economics (2004). HWWA Discussion Paper No. 281. Available at SSRN: https://ssrn.com/abstract=567062 or http://dx.doi.org/10.2139/ssrn.567062

Rasul Shams (Contact Author)

Hamburg Institute of International Economics ( email )

Heimhuder Strasse 71
D-20347 Hamburg, DE Hamburg 20148
Germany
+49 40 42834 442 (Phone)

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