Islamic Consumer Model, Fairness Behavior and Asymptotic Utility

Ghassan, Hassan B. (2015): Islamic Consumer Model, Fairness Behavior and Asymptotic Utility.

Abstract

Islamic faith and the ethical dimensions of the individual and the community play a significant role in guiding economic behavior by connecting the worldly life to the hereafter. The Shariah-compliant faith and ethical values generate specific behavior that requires Halal earning, fairness in spending and Halal utility leading to materialistic satisfaction and metaphysic reward. To analyze the Muslim consumer utility, in addition to the Islamic economics heritage, we rely on the instruments and prevailing assumptions in economics. Shaibani’s (750-805 AD) analysis of earning/spending/utility is based on three successive layers of earning/spending/utility; namely, the imperative, recommended, and the permissible. In this paper, we firstly contribute to developing a measure of the overspending and underspending. Secondly, based on the social solidarity, we show that the marginal earning has an effect on the macro MPC and depends mostly on the first differences between the MPC of the lower and upper social groups. Thirdly, according to the social welfare function, the permissible marginal utility is related to the faith interaction driving to an efficient transfer of purchasing capabilities to the targeted group. The optimal faithful behavior of affluent group leads, in the worldly life, to an elasticity of marginal utility less than or equal to one. The belief holding produces a hidden support in the worldly life but also engenders hereafter rewards through a steady eternal utility function, which generates an optimum of the marginal utility with elasticity greater than one.

• Item Type: MPRA Paper
• Language: English
• Keywords: Belief, Faith, Ethics, Consumption spending, Halal utility, Halal earning, Shaibani, Fairness.
• Subjects: A - General Economics and Teaching > A1 - General Economics > A13 - Relation of Economics to Social Values; B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B41 - Economic Methodology; D - Microeconomics > D1 - Household Behavior and Family Economics > D11 - Consumer Economics: Theory; D - Microeconomics > D6 - Welfare Economics; H - Public Economics > H3 - Fiscal Policies and Behavior of Economic Agents; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty; K - Law and Economics > K4 - Legal Procedure, the Legal System, and Illegal Behavior; N - Economic History > N4 - Government, War, Law, International Relations, and Regulation > N45 - Asia including Middle East; P - Economic Systems > P4 - Other Economic Systems > P46 - Consumer Economics ; Health ; Education and Training ; Welfare, Income, Wealth, and Poverty; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z12 - Religion

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