THE MUSLIM WORLD
Book Review
Vol 21 No 2 JANUARY-MARCH 2001
Containing an INDEX OF ISLAMIC LITERATURE
The Islamic Foundation
and
The International Institute of Islamic Thought
The Islamic Foundation
2001/1421
ISSN 0260-3063
Editors:
Manazir Ahsan
Consulting Editor: S. Parvez Manzoor
THE MUSLIM WORLD BOOK REVIEW containing an INDEX OF ISLAMIC LITERATURE, is a quarterly publication of the Islamic Foundation, Leicester, UK. Its four issues are published in Autumn, Winter, Spring and
Summer.
THE MUSLIM WORLD BOOK REVIEW aims to present the Muslim viewpoint on books and issues which concern Islam and Muslims. At a time of near explosion in the growth of interest in these areas accompanied by a highly disappointing level and quality of information, this review journal aspires to inform and stimulate lay readers and scholars alike, through detailed critical reviews, brief introductions and select bibliographies on recent and contemporary publications.
The opinions expressed in the MUSLIM WORLD BOOK REVIEW are the writers’ own. They are not necessarily in accordance with the views of the Islamic Foundation.
The INDEX OF ISLAMIC LITERATURE brings to the field of bibliography the same norms of academic rigor, analytical clarity and Islamic commitment that have made the MUSLIM WORLD BOOK REVIEW the mouthpiece of contemporary Muslim intellectualism.
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ECONOMIC GUIDELINES IN THE QURAN. By S.M. Hasanuz Zaman. International Institute of Islamic Thought, Islamabad, Pakistan, 1999. Pp. 398. ISBN 1-56564-094-2 (HB); 1-56564-093-4 (PB).
That the Qur’an provides guidance for all walks of life is an article of faith with the Muslims. With the emergence and growth of Islamic economics as a social discipline, the need to produce a compendium bringing together all those verses of the Qur’an that provide guidance in respect of issues and areas related to economics has increased manifold. Maulānā Sayyid Abul A’la Mawdūdī made a pioneering effort in this direction in the early sixties and his contribution was published in M.M. Sharif’s (ed.) A History of Muslim Philosophy Volume I. Altuyya Mohiuddin produced a valuable work of reference in Arabic. There has been a compilation of economic indices of the Qur’an and Ḥadith. Muhammad Akram Khan has compiled, in two volumes, aḥādīth relevant to the themes of economics. Dr. Hasanuz Zaman has now produced and the IIIT has published a much needed work on Economic Guidelines in the Quran, which would not only fill this vacuum, but serve as an important source to all those who are interested in research and education in the major fields of Islamic economics.
The verses of the Qur’an are grouped under five major headings dealing with ‘Basic Concepts’; ‘Social Behavior’; ‘Economic Parameters’; ‘Public Policy Guidelines’; and ‘Pre-Islamic Institutions’. Each section is subdivided to cover major areas within the group. The section on ‘Basic Concepts’ contains seven sub-sections dealing with ‘Special Terminology of the Qur’an’, ‘Philosophical Concepts’, ‘Human Instincts’, ‘Prerequisites of Economic Success’, ‘Economic Motivation’, ‘Ethics, Etiquettes and Norms’ and ‘Economic Resources’. The major economic sector (“Economic Parameters’) covers the topic of ‘Ownership’, ‘Sources of Earning’, ‘Wealth and Resourceful- ness’, ‘Consumption’, ‘Supply’, ‘Utilities’, ‘Wants’, ‘Productive Activities’, ‘Lab our and Enterprise’, ‘Population’, ‘Public Finance’, ‘Distribution of Wealth’, ‘Trade’, and ‘Public Debt’. The focus in ‘Policy Guidelines’ is on ‘Decision-Making and the Management of the Economy’, ‘Macro Economic Phenomenon’, ‘Economic Offences’, ‘Economic Security and Defense’.
This compilation is a product of serious research, innovative thinking, reflection and creative application of the Qur’anic guidance to the professional concerns of contemporary economists and policy-makers, looking at both theoretical and practical issues. As the text of the Qur’ānic verses is followed by their English translation, the usefulness of the work has increased manifold. Dr. Hasanuz Zaman is amongst the pioneers of Islamic economics and his earlier works on Economic Functions of an Islamic State: The Early Experience and Indexation of Arabs: An Islamic Perspective have earned him a position of respect. The present work shows his profound grasp of the message and meaning of the Qur’an and his robust intellectual capabilities which bring into sharp focus the relevance of the Qur’anic guidance to contemporary ideas and problems. Although every section is prefaced by a short introduction to the meaning and significance of verses of the Qur’an included in that section, there is very little effort to develop the
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Qur’anic ideas and concepts and spell out their implications. However, the fact of grouping together relevant issues has opened up new vistas for reflection and research. This compilation is an indispensable resource for all students and scholars interested in Islamic economics, particularly those whose command over the Arabic language and training in the sciences of the Qur’an is not of a level that qualifies them to directly reach and interpret the Qur’anic verses. In a work like this, there has to be some repetition, as references had to be made to the same verse under different headings. But this has made the work more useful, as each section can be consulted without reference to other sections. The compiler has provided ample cross-references, an Index of the verses included and a useful Subject Index.
The reviewer is unhappy about juxtaposing ‘man’ against ‘nature’ in Part B of ‘Basic Concepts’. Man versus the universe is a concept popularized by the post-enlightenment, secular stream of natural sciences, in the background of man’s new ambition to ‘conquer’ nature, and look upon nature as a partner. In an Islamic framework, ‘man’ and ‘universe’ are part of a divine scheme, elements of the same creation, supporting each other and not arrayed against one another. The concept of ‘man versus universe’ is at the root of some of the devastation wreaked by science and technology, particularly in the ecological realm. ‘Man and the universe’ and not ‘man versus the universe’ could give a more appropriate articulation of the Qur’anic message in this respect.
Economic Guidelines in the Quran serves another very useful purpose. While elimination of ribā and introduction of zakah remain key pillars of an Islamic economic dispensation, the present compilation shows the wide sweep of themes and concerns addressed by the Qur’an, and the multitude of normative guidance the Qur’ān provides in respect of a vast array of economic issues relevant to the establishment of a just socio-economic order, the real obligation of the Muslim Ummah.
THE POLITICAL ECONOMY OF THE MIDDLE EAST, VOL. III: ISLAMIC ECONOMIES. Ed. Tim Niblock and Rodney Wilson. An Elgar Reference Collection, Cheltenham, UK and Northampton, MA, USA, 1999. Pp. 505. ISBN 1-85898937-X.
Islamic economics is a nascent social discipline. It is an encouraging development that during the decade of the 1990s, recognition of this new approach to economics has increased in the academic circles of the West. A number of leading research and policy journals have published articles dealing with aspects of Islamic economics. More and more courses are being offered in universities and training institutes in Europe and America on Islamic economic themes. So is interest shown in Islamic Economics in international conferences and seminars, some exclusively devoted to this discipline, others devoting one ore two sessions to issues relevant to Islamic economics. Consequently, there is a burgeoning of literature, including some highly critical evaluations of the concepts and practices relating to the new
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Discipline. In recognition of the contributions made recently in this field, the Editors of this new series of books of readings on the political economy of the Middle East have devoted one volume to Islamic Economics. The Editors of this volume, Nib lock and Wilson, express keen interest in one of the major concerns of Islamic economics: the need to examine conventional economics that its concepts and policies have universal validity. They show preparedness to at least consider the claim of the Islamic economists that ‘the economic system should reflect religious values’, rather than a society’s values be ‘determined by the economic system’.
The volume under review consists of 23 articles selected from major journals of Western and Islamic scholarship published during the last 20 years, the earliest being Noorzoy’s articles on ‘Islamic Laws of Riba (interest) and their Economic Implications’ published in the International Journal of Middle Eastern Studies (1982) and the latest by Timur Kuran entitled ‘Islamic Economics and the Islamic Sub-Economy’ from the Journal of Economic Perspectives (1995). Six articles come from journals produced by institutions pioneering Islamic economics, including three articles from the Islamic Economics Review published by the International Association for Islamic Economics and the Islamic Foundation. Amongst the Islamic economists those represented include Umer Chapra, Nejatullah Siddiqui, Abbas Mirakhor, Mohsin Khan, Ziauddin Ahmad and Masudul Alam Chowdhry.
Rodney Wilson’s two articles are informative and sympathetic. Major critiques of Islamic Economics come from a Turkish economist Timur Kuran (‘Islamic Economics and the Islamic Sub-Economy’ and ‘The Economic System in Contemporary Islamic Thought and Assessment’), Siddiq Noorzoy (‘Islamic Laws on Riba (interest) and their Economic Implications’), Mehaded Valibeige (‘Islamic Economics and Economic Policy Formation in Post Revolution Iran: A Critique’) and Syed Vali Reza Nasr (‘Islamic Economics: Novel Perspectives’). Two articles on Ibn Khaldun’s economic thought by Joseph Spengler and Wieter Weiss are useful contributions. There is a tilt in favor of banking and finance, as is true of the major thrust of mainstream literature on Islamic economics. What is, however, not understandable is the unbalanced representation of critical, even negative writings to the neglect of some of the outstanding contributions of Islamic economists in relation to the Islamic rationale of prohibition of riba and development of models reflecting the working of Islamic financial institutions and instruments paving the way for the emergence of an alternate banking system. Islamic economists’ contributions in areas of micro-economics, economic development, fiscal policy and socio-economic welfare are underrepresented, particularly in view of the general theme of the series, i.e. The Political Economy of the Middle East.
Timur Kuran and Vali Reza Nasr harbor some apprehensions on the count that Islamic economists have a hidden political agenda. This is highly speculative and uncalled for. Nothing is hidden in the writings of Islamic economists and there is hardly any need to discover some imaginary Frankenstein’s monster between the lines. The extent to which the Islamic economic approach has a political economic ring has been clearly spelled out by the writers of this school of thought. They acknowledge with pride its
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roots in contemporary Islamic resurgence. The historical mission of the Ummah as delineated in the Qur’an and the Sunnah of the Prophet (pbuh) is the context for the development of this approach. They have openly challenged the artificial cocoon of positivism in which mainstream economics has tried to seek refuge, particularly in the marginalist and the neo-classical schools. The political economy is their main concern and they are not shy about it. But this does not dilute or compromise the scientific nature of their work. Name-calling cannot do the trick.
Critics of Islamic economics have grossly misrepresented the position of Islamic economists when they try to suggest that they rely mainly on ‘altruism’ and assume the homo Islamic us to be motivated only by moral considerations. These critics regard this to be the fatal mistake of Islamic economists as in their view ‘self-interest’ remains the sole motive for human endeavors. Self- interest, they hold, is a universal phenomenon and as such the Muslim world is no exception. This is missing the whole point the Islamic economists are making. They do not deny the role of self-interest. Islamic economists’ position is that the notion that economic behavior is motivated solely and exclusively by self-interest is unreal, both conceptually and on the basis of empirical evidence. These premises of classical and positive economics has been looked upon with suspicion by many from within, and is now being boldly challenged by the Islamic economists. It is being suggested by both that the positivist formulation is based on ignoring some of the assumptions made by classical economists and the evidence of patterns of human behavior based on empirical research by psychologists and sociologists.
Islamic economists do not rule out a definitive role of self-interest, they only deny its exclusivist claim. Self-interest is tempered by compassion, prudence and altruism. Market mechanism is accepted as a major framework for economic decision-making in an Islamic economic system, but it is subject to moral filters, societal vigilance and a positive (not totalitarian) role for the state. At the empirical level, the Islamic economists have tried to study human behavior in its different socio-moral contexts and not in total abstraction. They are concerned with many scenarios – a morally-oriented Islamic society, Muslim society deviating from the Islamic norms, and non-Muslim societies operating in the context of their own socio-moral concerns. If various patterns of behavior can be scientifically conceptualized despite intellectual commitment to the model of pure and perfect competition resulting in a variety of near real life situations from monopoly and monopsony to a myriad of imperfect competitions and this does not destroy or dislodge the perfect competition model, why cannot the Islamic model work as a frame of reference for analysis and policy formation in a variety of confirmatory or deviationist situations? Moreover, in the Islamic framework human motivation is not a ‘constant’, it is also a variable like other variables and subject to moral and policy influences. If mainstream economists can embrace the idea of ‘rights’ and ‘justice’ without the collapse of the paradigm, (see particularly the works of Rawl and Sen) why can there not be an Islamic economy where equity and rights are as important concerns as efficiency and enlightened self-interest.
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can
Another red herring has been discovered in the context of globalization and national economies. It is assumed that Islamic economic principles operate only in a rural economy or in communities that are small and integrated. Modern society has been impersonalized and as such in such an economy Islamic economic principles become irrelevant. This premise is nothing more than conjecture. It is not based on any scientific analysis of empirical evidence. Islam has remained a global power for over a thousand years and Muslims have always operated as a universal Ummah, despite multiplicity of political regimes. Global outreach is not new, despite new avenues and forms of globalization. It is highly presumptive to assume that smaller communities, local integration and regional groupings have become obsolete or that human elements can be totally bypassed in large urban societies or in global dealings. The whole movement towards Communitarianism in Europe and America is based on the rediscovery of the principle of human relationships and social integration at local, national and global levels. Green economics is also promoting this integration and human approach. It is the narrow-mindedness of some of the mainstream economists that they come out with a position of fatalism and ultimate hegemony of one model of economy and even surmise about the ‘end of history’. The critics are more obsessed with the figments of their own imagination and are ignoring the real needs of the modern society. Islamic economics challenges this one-dimensional approach which smacks of some kind of an implicit determinism. Islamic economists stand for human freedom and innovation and are optimistic about the future, despite all the difficulties that are very much there.
The critic’s assessment of the performance of some of the Islamic banks deserves to be taken seriously. The commonly used modes of murābahah (cost plus) and leasing are close to fixed-income financial instruments and the movement towards equity-based instruments is slow, to say the least. There is a gap between the theory and the practice of Islamic banking and these issues are being debated by Islamic economists with frankness and depth. They welcome criticism and evaluation from their secular colleagues. But, it is going too far to argue from this limited experience that equity-based modes are unrealistic or impractical and interest in some form would have to continue to be the kingpin of the system. One of the reasons for the slow movement in that direction is the lack of political will of those at the helm of affairs in the Muslim lands. The grip of Western financial institutions on the rest of the world also hampers their efforts towards liberation from the debt slavery of the G-7 and international financial institutions. Theoretical analysis suggests that the model of Islamic banking is not only viable, but even superior on the counts of stability, equity and sustained growth. The experiment is yet to be made in full measure. We agree that the proof of the pudding is in the eating. The experiment is still in its early stages, while review and evaluation is and should be an on-going process, it is too early to pronounce judgements.
Leicester, UK
Khurshid Ahmad
