This presentation will provide an understanding regarding Islamic Economic.

1. Topic 1
Introduction to Islamic Economics
Overview of Islamic Economics
Methodology
Shabeer Khan

2. Definition of Methodology
A body of rules and
postulates that are
employed by
researchers in a
discipline of study.
General
Blaug (1993) defines the
methodology of economics as
the branch of economics where
we study how economists justify
their theories, and the reasons
they offer for preferring one
theory over another.
Economics

3. Scholars views on Methodology
Shd Muhd Baqir al-Sadr (1983)
Naqvi (1981)
Mannan (1983)
Anwar (1990)
Chapra (1996)
Monzer Kahf (2003)
Asad Zaman (2013)

4. 1. Shd Muhd Baqir al-Sadr (1983)
Economics science give details about economic phenomenon
while economic school advises the way economic life should be
conducted.
Both study economic problem but the methodology they use
regarding solution and understanding the economic phenomenon
and problem is different
• He considers Islamic economics as the
way Islam prefers the solution of practical
economic problems in line with the concept
of justice”.
• Islamic economics is a doctrine (school of
thought) not a science.

5. 2. Naqvi (1981)
Unity Equilibrium
Free will Responsibility
These ethical axioms are derived from
Qur’ān and Hadith.
could be the reference points that guide
the development of theories of economics.

6. 3.Mannan (1983)
Identification of economics problem
Search for guiding principles of Shariah
Theoretical formulation of the economic problems
Prescriptions of appropriate economic policy
Implementation of policy
An ought statement
Exposing the results of evaluation

7. 4. Anwer (1990)
To Islamize modern
economic theories
and models
Methodology of Islamic economics
can be done in two ways
To develop
economic theories
independent of
Western thought
He suggests to contrast the components of
conventional economic theories with components that
make-up an Islamic body and basis. The process
requires ijtihād from the scholars to classify the
components of conventional economic theories and
models into Islamic, un-Islamic, or neutral elements.

8. 5. Chapra (1996)
First examines whether the economic
hypotheses fits within the logical structure
of the Islamic paradigm or not.
If yes, then evaluate the hypotheses
through logical reasoning.
If this step is satisfactory, then possible
empirical testing of hypotheses to see its
reliability in practical life.

9. 6. Monzer Kahf (2003)
Elaboration of the Islamic economic system
Revision of conventional economic theory
Elaborating the Islamic economic system to discover theories.
Some of the principles and theories may be taken directly
from the text of Qur’ān and Sunnah, such as the prohibition of
ribā and the prescription of zakāh.
In revision the first is takhliyah; identifying and isolating
the biased postulates of conventional economic. The
second is tahliyah; incorporation in economics of
positive postulates derived from Shariah.

10. 7. Zaman (2013)
1. Describe the Best possible behavior (ideal) which is
normative statement
2. Study the difference between actual (empirically
observable) & ideal one
3. Remove the difference between actual and ideal
(recommended by Islam)
Fundamental mistakes? Focus on observables, instead of
reality
Positivism: All knowledge is based on observables (facts) +
reason
History can not be used to forecast future.
Utilitarianism: short run- long run, social- individual
Scientific method can not proof morality.
Laying , cheating , murder are not wrong
Islam can offer us a methodology Absolute basis for moral

11. Personal comments
1. Islamic economics use a framework derived from divine
text
2. Islamic economics is both normative and positive science. study
existing phenomenon and providing guideline that how the
economy should behave by apply normative values
3. Islamic economics builds ethical values such as justice,
benevolence, moderation, sacrifice, caring for others.
4. Islamic economics is concerned with the falah of man and in
creating such social and institutional conditions which maximize
falah in a society.
5. Keeping based on Quran and Sunnah, it testifies the truth or
falsifies the assumptions and predictions on the ground of twin
criteria of rationality and empirical evidence.
6. Islamic economics accept relative scarcity, without it what
meaning would one put on tolerance and cooperation? Who would
work for whom and why? Why would people hoard wealth or need
condemn the act?
7. Islamic economics need not to through away the baby with the
bath water. The knowledge of economics coming from mainstream
sources must be sifted and passed through the Islamic filter for
acceptance