Macro Consumption Function in an Islamic Framework by Fahim Khan: Comments

Hasan, Zubair (1985): Macro Consumption Function in an Islamic Framework by Fahim Khan: Comments. Published in: JKAU: Islamic Economics, Jeddah , Vol. 2, No. 2 (1985): pp. 79-81.

Abstract

This is a critique of an article of M. Fahim Khan pulished in an earlier issue of the same journal It argues that in other economic systems including capitalism too play an important role to mitigate the hardships of the poor but unlike the Islamic system they do not show their impact on income determination. Transfer of income to the poor via zakah will reduce the saving potential of the economy. To what extent this will be neutralized by the rich abstaining from frivolous spending due to the fear of God is uncertain. Hence the macro model of the author to demonstrate the superiority of the Islamic system is not convincing.

• Item Type: MPRA Paper
• Institution: International Islamic University of Malaysia
• Language: English
• Keywords: Islam and consumption; zakah; israf
• Subjects: E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy; D - Microeconomics > D1 - Household Behavior and Family Economics > D11 - Consumer Economics: Theory