Category Archives: Articles on Islamic Economics

Islam and Institution of Interest Based Lending


Danial Pirani In modern times, the institution of interest is regarded as critical for the stability of an economy. Nearly all the economic and financial institutions are, in one way or the other, connected to the interest based transactions. Interest … Continue reading

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Limitations of Mainstream Consumer Theory in Economics


Salman Ahmed Shaikh Mathematical tractability has restricted economic analysis of consumer behavior within a confined boundary of certain axioms. Often, these axioms are found to be empirically false. Even more importantly, these axioms and the analytical framework based on them … Continue reading

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Does Science Pose Challenge to Islamic Worldview


Salman Ahmed Shaikh In simple words, science is knowledge established by observation and experimentation through an objective process. Scientific knowledge substantiates that the design, variety and balance in the universe is complex, intricate and detailed. Science tries to disentangle useful … Continue reading

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Importance of Worldview in Shaping Economic Choices


Salman Ahmed Shaikh Famine, death from hunger and debt enslavement is the fact of life for the half of the people on earth not because that overall, the societies have scarce resources, but because the distribution of resources is inequitable … Continue reading

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Islamic Economics and Behavioral Studies of Religious Agents


Salman Ahmed Shaikh There are two basic contents of religion, the beliefs and the other is practices. For the belief part, commonly shared history, archeology and science also provides sufficient hints for one to rationally decide and keep the belief … Continue reading

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Welfare Function in Islam


Salman Ahmed Shaikh Human welfare in Islam encompasses economic welfare, but comprises much more than that. The achievement of human welfare is sought in both aspects of human life, i.e. worldly life and eternal life hereafter. Hence, the human welfare … Continue reading

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Difference between Islamic Economics and Islamic Law


Salman Ahmed Shaikh Islamic law is derived from holy Quran and teachings of Prophet Muhamad (pbuh). Analogical deduction of specific juristic applications based on core principles is part of Fiqh. But, to be meritorious as a separate field of inquiry, … Continue reading

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Labor Productivity and Technical Progress in Islamic Economic Framework


Salman Ahmed Shaikh Most developing countries have lower labor productivity. Some of the reasons why people are not able to increase their productivity include: lack of education and hence lack of employable skills, poor health and malnutrition. Islam has made … Continue reading

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Critical Questions on Marxian Economics


Salman Ahmed Shaikh Marx said that labor creates surplus value in production process which the capitalists extract in an exchange. The surplus accumulates and this is exploitation of labor by capitalists. However, we note few observations below. First, the payoffs … Continue reading

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Is Islam the Cause of Underdevelopment


Salman Ahmed Shaikh It is observed that many of the developing countries are countries with Muslim majority population. In fact, if we flip this, almost every country with Muslim majority population seems to be underdeveloped. Is this a coincidence or … Continue reading

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