Defining Islamic Economics

Islamic economics is different from the conventional economic system. From our discussion on Islamic worldview, it is now clear that the frameworks of Islamic economic system must be within those parameters. Thus, the philosophy, aims and objectives, methodology and tools of policy of the system are clearly governed by and built based on, the principles of shari’ah.

Then, what is Islamic economics? Because of its dynamism, Muslim economists have different ways to define Islamic economics. Some of the definitions are:

1. Islamic economics aims at the study of human falah achieved by organizing the resources of earth on the basis of cooperation and participation (Akram Khan, 1404)

2. Islamic economics is the knowledge and application of injunctions and rules of the shari’ah that prevent injustice in the application and disposal of material resources in order to provide satisfactions to human beings and enable them to perform their obligations to Allah and the Society (Hasanuz Zaman, 1404)

3. Islamic economics is the study of Muslim behavior who organizes the resources, which are a trust, to achieve falah (Muhammad Arif, (1405)

4. Islamic economics is an approach to, and process of, interpreting and solving man’s economic problems based on the values, norms, laws and institutions found in, and derived from the sources of Islam” (Aslam)

5. Economics, from the Islamic (Khaldunian) view point studies the behavior of men and women, individually and in their association and socialization, in order to understand the patterns and modes of this behavior, its motives and incentives, as well as its goals and objectives, and responses and reactions, with and without being restricted to a specific situation, norms, set of moral values, or legal, political, religious, etc. framework.(Monzer Kahf)

Basically, from the definitions given, we can highlight few important points that each of the abovementioned scholars would have in their respective definition of Islamic economics. First, it is clear that the objective of Islamic economics is to achieve falah. Second, in doing so, the resources must be managed, preserved, conserved and utilized according to the rules of shari’ah.

Obviously, Islamic economic system is very different from the conventional definition of economics which only focuses on the way how we utilize the limited resources to fulfill man’s unlimited wants.