A Critical Overview of Islamic Economics from a Welfare-State Perspective

Soldatos, Gerasimos T. (2015): A Critical Overview of Islamic Economics from a Welfare-State Perspective.

Abstract

This paper builds upon the following critique of Islamic economics: (a) Persistence on the literal interpretation of what the theology of Islamic law implies socioeconomically, (b) Rejection subsequently of the core western economic principle of homo economicus-cum-competition, though homo economicus behavior is innermost to absence of riba al-fadl (of exploitation in the goods markets) in the large atleast impersonal markets of our times, (c) Rejection, because of the ahistorical view of the West and hence, of inability to realize that the Cold War European welfare state with a constitution inspired by social solidarity as it derives not politically but religiously from Islamic law, might be worth followed by Islam, and (d) Identification of riba an-nasiya (of exploitation in the financial markets) with zero interest rate charges and not with zero commercial bank seigniorage.

• Item Type: MPRA Paper
• Language: English
• Keywords: Islamic economics, Deduction vs. theologically induced induction, Homo economicus, Riba (exploitation), Welfare State
• Subjects: B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B41 - Economic Methodology; D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement; D - Microeconomics > D6 - Welfare Economics > D64 - Altruism ; Philanthropy; H - Public Economics > H1 - Structure and Scope of Government > H11 - Structure, Scope, and Performance of Government; P - Economic Systems > P4 - Other Economic Systems > P48 - Political Economy ; Legal Institutions ; Property Rights ; Natural Resources ; Energy ; Environment ; Regional Studies; P - Economic Systems > P5 - Comparative Economic Systems > P51 - Comparative Analysis of Economic Systems; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z12 - Religion

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