Al-Ghazali was an influential Muslim scholar who contributed to Islamic economic thought. He drew from both religious and secular sources to develop an ethical framework for economic activity based on Islamic principles. For Al-Ghazali, economic activity was permissible if it fulfilled basic human needs in a way that was consistent with sharia and promoted social welfare. He emphasized sharing wealth equitably and avoiding injustice in business dealings. Al-Ghazali's economic views were grounded in the Quran, hadith, and concept of maslaha or social benefit.
This document provides an overview of different economic systems including conventional, capitalist, communist/socialist, mixed, and Islamic systems. It discusses key principles such as private property and profit motive in capitalism, nationalization and equality in communism/socialism, and a mixture of public and private ownership in mixed economies. The Islamic economic system is defined as studying human behavior in using resources for individual and community benefit according to Sharia principles like tauhid and khalifah. It aims to fulfill the maqasid or purposes of Sharia like preserving religion, intellect, life, property, and dignity. In conclusion, while businesses generally seek profit, Islamic economy emphasizes using resources for broader human and social welfare within Sharia guidelines.
Concept of RIBA, Interest & Profit in Islamic Economics SystemYousuf Ibnul Hasan
RIBA does not justify money to be a medium of exchange and develop a love of money, greed and selfishness instead of respect for the money for socioeconomic development for the humanity.
This document provides an overview of strategic management from an Islamic perspective. It discusses key concepts like Maqasid Shariah (objectives of Shariah), which scholars have categorized into essentials (daruriyyat), needs (hajiyyat), and luxuries (tahsiniyyat). The document then explains the strategic management process, which involves strategy analysis, formulation, implementation, evaluation, and control. It notes these should be based on Islamic principles like consultation (shura) and cooperation (ta'awun). The document concludes that the overall aim of Islamic rulings is to achieve goodness and remove harm or corruption.
Islamic banking provides an interest-free alternative to conventional banking based on Shariah (Islamic law) principles. It prohibits Riba (usury or interest) and involves profit/loss sharing arrangements. While still evolving, Islamic banking has grown significantly in recent decades and shows potential to mobilize resources and support economic development in accordance with Islamic values. However, it also faces ongoing challenges in translating principles into practical products and services.
Principles of Islamic Economics In The Light Of the Holy Quran and Sunnahinventionjournals
The purpose of this research is to review the principles of Islamic economy with reference to injunctions of Islam. This paper presents selected literature relating to the principles of Economics of Islam according to the Holy Quran. The study of the Holy Quran reveals that the basic principles of Islamic Economy are briefly discussed in the Holy Book while the details are elaborated in the Ahadith(Traditions of the Holy Prophet S.A.W). These principles have been transformed into inferred rules by the AIMAS (Mujtahdeen) in the light of the Holy Quran and the Ahadith. To ensure economic equality, Allah the Al mighty, has directed the rich(wealthy) people to share their financial resources with the needy people. This ensures equal distribution of wealth in the society. Through Islamic Economic System, the concept of Welfare State can be successfully implemented, As practically demonstrated by Companions of the Holy Prophet (S.A .W)(Khulafa-ERashideen)During their Rule(Caliphate) for a period of about 30 years. Allah Ta’ala has promised to provide livelihood to every soul, as such; nobody lives without food and the means of livelihood in this way, equality in economic right has been ensured for all. If the principles of Islamic economy are implemented in letter and spirit, it will contribute towards the economic development in the society. An Economic System based on the Quranic principles of equitable society and productive investment can effectively remove much of the chronic economic illnesses as suffered by the Modern Society
The document provides an overview of the evolution and growth of the Islamic financial system over the past six decades. It begins by noting that Islamic finance originated in Egypt in the 1960s with the establishment of the first social bank based on profit and loss sharing principles. It then discusses how Islamic finance later spread to other countries like Pakistan and gained more widespread acceptance. The document highlights influential figures like Dr. Ahmed Al Naggar who helped establish early Islamic banks and organizations to support the development of Islamic finance education and standards. It concludes by noting that Islamic finance has now grown to be a major component of the financial systems in many Muslim-majority countries and regions over the past 60 years.
Quran is not a book of laws but a book of
principles, it gives the spirit of laws not the laws
themselves. It is an assistant not a rival.
وما أرسلنا من رسول إال أن يطاع بإذن هللا
ولو شاء ربك لآمن من في األرض كلهم جميعا أفأنت تكره الناس حتى يكون
This document provides an overview of different economic systems including conventional, capitalist, communist/socialist, mixed, and Islamic systems. It discusses key principles such as private property and profit motive in capitalism, nationalization and equality in communism/socialism, and a mixture of public and private ownership in mixed economies. The Islamic economic system is defined as studying human behavior in using resources for individual and community benefit according to Sharia principles like tauhid and khalifah. It aims to fulfill the maqasid or purposes of Sharia like preserving religion, intellect, life, property, and dignity. In conclusion, while businesses generally seek profit, Islamic economy emphasizes using resources for broader human and social welfare within Sharia guidelines.
Concept of RIBA, Interest & Profit in Islamic Economics SystemYousuf Ibnul Hasan
RIBA does not justify money to be a medium of exchange and develop a love of money, greed and selfishness instead of respect for the money for socioeconomic development for the humanity.
This document provides an overview of strategic management from an Islamic perspective. It discusses key concepts like Maqasid Shariah (objectives of Shariah), which scholars have categorized into essentials (daruriyyat), needs (hajiyyat), and luxuries (tahsiniyyat). The document then explains the strategic management process, which involves strategy analysis, formulation, implementation, evaluation, and control. It notes these should be based on Islamic principles like consultation (shura) and cooperation (ta'awun). The document concludes that the overall aim of Islamic rulings is to achieve goodness and remove harm or corruption.
Islamic banking provides an interest-free alternative to conventional banking based on Shariah (Islamic law) principles. It prohibits Riba (usury or interest) and involves profit/loss sharing arrangements. While still evolving, Islamic banking has grown significantly in recent decades and shows potential to mobilize resources and support economic development in accordance with Islamic values. However, it also faces ongoing challenges in translating principles into practical products and services.
Principles of Islamic Economics In The Light Of the Holy Quran and Sunnahinventionjournals
The purpose of this research is to review the principles of Islamic economy with reference to injunctions of Islam. This paper presents selected literature relating to the principles of Economics of Islam according to the Holy Quran. The study of the Holy Quran reveals that the basic principles of Islamic Economy are briefly discussed in the Holy Book while the details are elaborated in the Ahadith(Traditions of the Holy Prophet S.A.W). These principles have been transformed into inferred rules by the AIMAS (Mujtahdeen) in the light of the Holy Quran and the Ahadith. To ensure economic equality, Allah the Al mighty, has directed the rich(wealthy) people to share their financial resources with the needy people. This ensures equal distribution of wealth in the society. Through Islamic Economic System, the concept of Welfare State can be successfully implemented, As practically demonstrated by Companions of the Holy Prophet (S.A .W)(Khulafa-ERashideen)During their Rule(Caliphate) for a period of about 30 years. Allah Ta’ala has promised to provide livelihood to every soul, as such; nobody lives without food and the means of livelihood in this way, equality in economic right has been ensured for all. If the principles of Islamic economy are implemented in letter and spirit, it will contribute towards the economic development in the society. An Economic System based on the Quranic principles of equitable society and productive investment can effectively remove much of the chronic economic illnesses as suffered by the Modern Society
The document provides an overview of the evolution and growth of the Islamic financial system over the past six decades. It begins by noting that Islamic finance originated in Egypt in the 1960s with the establishment of the first social bank based on profit and loss sharing principles. It then discusses how Islamic finance later spread to other countries like Pakistan and gained more widespread acceptance. The document highlights influential figures like Dr. Ahmed Al Naggar who helped establish early Islamic banks and organizations to support the development of Islamic finance education and standards. It concludes by noting that Islamic finance has now grown to be a major component of the financial systems in many Muslim-majority countries and regions over the past 60 years.
Quran is not a book of laws but a book of
principles, it gives the spirit of laws not the laws
themselves. It is an assistant not a rival.
وما أرسلنا من رسول إال أن يطاع بإذن هللا
ولو شاء ربك لآمن من في األرض كلهم جميعا أفأنت تكره الناس حتى يكون
There are two types of riba (interest) prohibited in Islam:
1) Riba al-nasiyah (interest on loans) which refers to any predetermined increase on a loan based on time.
2) Riba al-fadl (interest in exchange) which occurs when exchanging amounts of the same commodity if the amounts are not equal or not simultaneous.
The key differences between the two are that riba al-nasiyah involves lenders/borrowers while riba al-fadl involves sellers/buyers, and riba al-nasiyah considers time while riba al-fadl can occur in a spot transaction. Both ultimately aim to curb unfair
A Comparison between Capitalism & Islamic Economical System An Overviewlinaodeh
The document compares the Islamic economic system to capitalism. The Islamic system emphasizes moral values and spiritual fulfillment over individual preferences. It also recognizes the concept of the afterlife and human brotherhood, which are absent from capitalism. When the Prophet Muhammad established the city of Medina, he introduced the concept of human brotherhood to share profits and trade between new immigrants, boosting the economy. Implementing Islamic values like morality, the afterlife, and brotherhood could make the system more beneficial than capitalism today by addressing issues it lacks.
The document discusses Shariah screening methodology for classifying stocks as compliant or non-compliant. It outlines the screening process in Malaysia, which involves business activity and financial ratio benchmarks determined by the Securities Commission Shariah Advisory Council. The benchmarks have been revised, and could impact status of some mixed-business companies. The justification for the benchmarks is also discussed, drawing from Islamic legal principles around permissible levels of prohibited elements in items or businesses.
This document discusses the concept of al-Tawarruq, an Islamic financing structure. It begins with an overview of Bank Islam Malaysia and its Shariah governance bodies. It then defines al-Tawarruq as the buying of a commodity on deferred payment and selling it for cash to a third party. The document outlines arguments for both prohibiting and permitting al-Tawarruq, and discusses issues around its operationalization. It concludes with trends showing growing use of al-Tawarruq products in Malaysian Islamic banks.
1) Islamic banks obtain funds from deposits and use those funds to finance various approved investment activities like trade financing. More than 75% of funds come from deposits.
2) Financing must follow Shariah principles like prohibiting interest and uncertainty and balancing individual and societal needs.
3) The bank uses modes like murabahah, ijarah, mudharabah and musharakah with different structures for purchasing, leasing or jointly investing in assets and sharing profits and losses according to capital contributions.
The document discusses the basic concepts of the Islamic economic system. It summarizes that Islam provides a balanced view between freedom and equality, allowing for private property rights but not unconditionally to cause disorder. The Islamic economic system aims for justice and equality in the distribution of wealth by taking from the rich and giving to the poor. It seeks to narrow the gap between rich and poor by having everyone participate equally in profits and losses while allowing market forces to operate.
The document discusses the role of the Shariah Advisory Council (SAC) under the Islamic Financial Services Act 2013 (IFSA) in Malaysia. Key points:
1) The IFSA strengthened Shariah governance for Islamic financial institutions, requiring them to ensure full Shariah compliance.
2) The SAC advises Bank Negara Malaysia (BNM) on Shariah matters and issues rulings that are binding on Islamic banks and courts.
3) Islamic banks must refer matters to the SAC and comply with Shariah standards it specifies based on SAC advice. The SAC's rulings take precedence over rulings from an internal Shariah body of an Islamic bank.
The document provides an overview of Islamic economic systems, including its key principles, structures, and implementation. It discusses that Islamic economics is based on principles from Islamic sources that offer an alternative set of parameters for economic activity focused on human welfare. The main objectives of Islamic economy are social and economic justice, equality, and ensuring wealth circulation to prevent concentration.
Islamic leadership is based on trust, accountability, and following the example of Prophet Muhammad. An effective leader in Islam must be virtuous, consult with followers, and make decisions that benefit humanity and are pleasing to God. The document discusses Islamic primary sources on leadership, the qualities of a good leader, and principles for team dynamics, power, conflict resolution, and decision-making based on shura (consultation).
This document is an introduction to a book comparing the principles of Islam and the Universal Declaration of Human Rights. It discusses how differences in views are inevitable in human society but must be resolved peacefully through agreed procedures, such as submitting to the rule of law. The Declaration is considered a milestone in the struggle for freedom, justice and equality that has been ongoing for centuries. The book will examine how Islamic teachings compare to the principles laid out in the Declaration.
Wealth planning is very important of long term wealth creation. Proper planning plays very important role in developing and creating the wealth. Retirement is very important for every individual.
Wealth planning is the art of structuring your wealth while building it, preserving it, and in order to transfer it to the next generation tax-optimised. Wealth planning is a mix of tax planning, wealth protection, estate planning and business succession planning and relates to your total worldwide wealth.
Liquidity planning. Liquidity planning is an important component in an effective wealth management and succession planning strategy. We will help you in tailoring solutions that can provide liquidity in the future to enable you to protect and preserve your wealth across generations.
This document discusses the Islamic legal principle of sadd al-dhara'i' (blocking the means). It defines sadd al-dhara'i' as blocking the means to an expected evil end to prevent it from materializing. Means can be blocked if they are likely or certain to lead to an unlawful result. The document provides examples from the Quran, hadiths, and rulings of early jurists to illustrate different types of means and when they can be prohibited. It also discusses contemporary issues where the principle could apply, like regulating internet use or banning fireworks to prevent harm.
This document discusses poverty from an Islamic perspective. It defines poverty as not possessing sufficient necessities to fulfill basic human needs as defined in Islam. It discusses the causes of poverty, including exploitation, interest/riba, and debt. The roles of citizens in alleviating poverty according to Islam include paying zakat and sadaqah, distributing wealth according to Islamic principles of inheritance and marriage, and upholding concepts of neighborly rights and duties. Funds for assisting the poor come from obligatory zakat payments as well as optional charitable trusts and gifts. The document emphasizes Islam's developmental approach of empowering the poor rather than simply providing transfers.
The document discusses various Islamic business transactions and contracts. It defines key terms like muamalah and aqad. It outlines 6 main categories of contracts in Islamic law - contracts of exchange, security, partnership, safe custody/investment, utilization of usufruct, and work/services. Examples of specific contracts are provided under each category like bay, salam, ijarah, and mudharabah. The principles and evidence for different types of transactions from the Quran and hadith are also summarized.
Zakat is a religious obligation in Islam where a fixed portion of wealth is paid yearly to benefit the poor. It is one of the five pillars of Islam. Every Muslim who owns a minimum amount of wealth (nisab) for over one year must pay zakat at fixed rates based on the type of wealth, such as 2.5% of money, 10% of agricultural output, and varying percentages for animals. Zakat purifies the soul and promotes social justice and prosperity by redistributing wealth from rich to poor and funding social services. It helps establish an Islamic economic system with equitable distribution of resources and minimal inequality and unemployment.
The document provides an overview of Muamalat (Islamic commercial transactions) and defines the elements of a contract in Islamic law. It discusses the four essential elements of a contract: [1] the contracting parties, [2] the form of the contract through offer and acceptance, [3] the subject matter and price, and [4] the purpose and effect of the contract. It then describes different types of contracts in more detail, including contracts of ownership through exchange or charity, security contracts, partnership contracts, and more. The document also discusses capacity and impediments to capacity for entering into contracts.
This document provides an introduction to Islamic economics and finance. It begins by outlining the objectives of understanding key principles like Islamic vs. modern economics and Islamic vs. conventional finance. It then discusses the two primary sources of Islamic law - the Quran and Sunnah. Several principles of Islamic economics are described, including Allah as the true owner, humanity's role as trustees of resources, permissible ways of earning and distributing wealth, prohibitions against interest and uncertainty. The document provides an overview of the foundations and guidelines for economic activities in Islam.
The document discusses the economic system in Islam. It states that Islam provides guidelines for all spheres of life, including economics. The Islamic economic system aims to establish a just society where people behave honestly and responsibly in their transactions. It recognizes private, collective, and state possession of wealth. Some key principles of the Islamic economic system are that earnings and spending must be through halal means, individuals have a right to property with limits to ensure societal benefit, payment of zakat is compulsory to help the poor, and transactions involving interest are prohibited.
There are two types of riba (interest) prohibited in Islam:
1) Riba al-nasiyah (interest on loans) which refers to any predetermined increase on a loan based on time.
2) Riba al-fadl (interest in exchange) which occurs when exchanging amounts of the same commodity if the amounts are not equal or not simultaneous.
The key differences between the two are that riba al-nasiyah involves lenders/borrowers while riba al-fadl involves sellers/buyers, and riba al-nasiyah considers time while riba al-fadl can occur in a spot transaction. Both ultimately aim to curb unfair
A Comparison between Capitalism & Islamic Economical System An Overviewlinaodeh
The document compares the Islamic economic system to capitalism. The Islamic system emphasizes moral values and spiritual fulfillment over individual preferences. It also recognizes the concept of the afterlife and human brotherhood, which are absent from capitalism. When the Prophet Muhammad established the city of Medina, he introduced the concept of human brotherhood to share profits and trade between new immigrants, boosting the economy. Implementing Islamic values like morality, the afterlife, and brotherhood could make the system more beneficial than capitalism today by addressing issues it lacks.
The document discusses Shariah screening methodology for classifying stocks as compliant or non-compliant. It outlines the screening process in Malaysia, which involves business activity and financial ratio benchmarks determined by the Securities Commission Shariah Advisory Council. The benchmarks have been revised, and could impact status of some mixed-business companies. The justification for the benchmarks is also discussed, drawing from Islamic legal principles around permissible levels of prohibited elements in items or businesses.
This document discusses the concept of al-Tawarruq, an Islamic financing structure. It begins with an overview of Bank Islam Malaysia and its Shariah governance bodies. It then defines al-Tawarruq as the buying of a commodity on deferred payment and selling it for cash to a third party. The document outlines arguments for both prohibiting and permitting al-Tawarruq, and discusses issues around its operationalization. It concludes with trends showing growing use of al-Tawarruq products in Malaysian Islamic banks.
1) Islamic banks obtain funds from deposits and use those funds to finance various approved investment activities like trade financing. More than 75% of funds come from deposits.
2) Financing must follow Shariah principles like prohibiting interest and uncertainty and balancing individual and societal needs.
3) The bank uses modes like murabahah, ijarah, mudharabah and musharakah with different structures for purchasing, leasing or jointly investing in assets and sharing profits and losses according to capital contributions.
The document discusses the basic concepts of the Islamic economic system. It summarizes that Islam provides a balanced view between freedom and equality, allowing for private property rights but not unconditionally to cause disorder. The Islamic economic system aims for justice and equality in the distribution of wealth by taking from the rich and giving to the poor. It seeks to narrow the gap between rich and poor by having everyone participate equally in profits and losses while allowing market forces to operate.
The document discusses the role of the Shariah Advisory Council (SAC) under the Islamic Financial Services Act 2013 (IFSA) in Malaysia. Key points:
1) The IFSA strengthened Shariah governance for Islamic financial institutions, requiring them to ensure full Shariah compliance.
2) The SAC advises Bank Negara Malaysia (BNM) on Shariah matters and issues rulings that are binding on Islamic banks and courts.
3) Islamic banks must refer matters to the SAC and comply with Shariah standards it specifies based on SAC advice. The SAC's rulings take precedence over rulings from an internal Shariah body of an Islamic bank.
The document provides an overview of Islamic economic systems, including its key principles, structures, and implementation. It discusses that Islamic economics is based on principles from Islamic sources that offer an alternative set of parameters for economic activity focused on human welfare. The main objectives of Islamic economy are social and economic justice, equality, and ensuring wealth circulation to prevent concentration.
Islamic leadership is based on trust, accountability, and following the example of Prophet Muhammad. An effective leader in Islam must be virtuous, consult with followers, and make decisions that benefit humanity and are pleasing to God. The document discusses Islamic primary sources on leadership, the qualities of a good leader, and principles for team dynamics, power, conflict resolution, and decision-making based on shura (consultation).
This document is an introduction to a book comparing the principles of Islam and the Universal Declaration of Human Rights. It discusses how differences in views are inevitable in human society but must be resolved peacefully through agreed procedures, such as submitting to the rule of law. The Declaration is considered a milestone in the struggle for freedom, justice and equality that has been ongoing for centuries. The book will examine how Islamic teachings compare to the principles laid out in the Declaration.
Wealth planning is very important of long term wealth creation. Proper planning plays very important role in developing and creating the wealth. Retirement is very important for every individual.
Wealth planning is the art of structuring your wealth while building it, preserving it, and in order to transfer it to the next generation tax-optimised. Wealth planning is a mix of tax planning, wealth protection, estate planning and business succession planning and relates to your total worldwide wealth.
Liquidity planning. Liquidity planning is an important component in an effective wealth management and succession planning strategy. We will help you in tailoring solutions that can provide liquidity in the future to enable you to protect and preserve your wealth across generations.
This document discusses the Islamic legal principle of sadd al-dhara'i' (blocking the means). It defines sadd al-dhara'i' as blocking the means to an expected evil end to prevent it from materializing. Means can be blocked if they are likely or certain to lead to an unlawful result. The document provides examples from the Quran, hadiths, and rulings of early jurists to illustrate different types of means and when they can be prohibited. It also discusses contemporary issues where the principle could apply, like regulating internet use or banning fireworks to prevent harm.
This document discusses poverty from an Islamic perspective. It defines poverty as not possessing sufficient necessities to fulfill basic human needs as defined in Islam. It discusses the causes of poverty, including exploitation, interest/riba, and debt. The roles of citizens in alleviating poverty according to Islam include paying zakat and sadaqah, distributing wealth according to Islamic principles of inheritance and marriage, and upholding concepts of neighborly rights and duties. Funds for assisting the poor come from obligatory zakat payments as well as optional charitable trusts and gifts. The document emphasizes Islam's developmental approach of empowering the poor rather than simply providing transfers.
The document discusses various Islamic business transactions and contracts. It defines key terms like muamalah and aqad. It outlines 6 main categories of contracts in Islamic law - contracts of exchange, security, partnership, safe custody/investment, utilization of usufruct, and work/services. Examples of specific contracts are provided under each category like bay, salam, ijarah, and mudharabah. The principles and evidence for different types of transactions from the Quran and hadith are also summarized.
Zakat is a religious obligation in Islam where a fixed portion of wealth is paid yearly to benefit the poor. It is one of the five pillars of Islam. Every Muslim who owns a minimum amount of wealth (nisab) for over one year must pay zakat at fixed rates based on the type of wealth, such as 2.5% of money, 10% of agricultural output, and varying percentages for animals. Zakat purifies the soul and promotes social justice and prosperity by redistributing wealth from rich to poor and funding social services. It helps establish an Islamic economic system with equitable distribution of resources and minimal inequality and unemployment.
The document provides an overview of Muamalat (Islamic commercial transactions) and defines the elements of a contract in Islamic law. It discusses the four essential elements of a contract: [1] the contracting parties, [2] the form of the contract through offer and acceptance, [3] the subject matter and price, and [4] the purpose and effect of the contract. It then describes different types of contracts in more detail, including contracts of ownership through exchange or charity, security contracts, partnership contracts, and more. The document also discusses capacity and impediments to capacity for entering into contracts.
This document provides an introduction to Islamic economics and finance. It begins by outlining the objectives of understanding key principles like Islamic vs. modern economics and Islamic vs. conventional finance. It then discusses the two primary sources of Islamic law - the Quran and Sunnah. Several principles of Islamic economics are described, including Allah as the true owner, humanity's role as trustees of resources, permissible ways of earning and distributing wealth, prohibitions against interest and uncertainty. The document provides an overview of the foundations and guidelines for economic activities in Islam.
The document discusses the economic system in Islam. It states that Islam provides guidelines for all spheres of life, including economics. The Islamic economic system aims to establish a just society where people behave honestly and responsibly in their transactions. It recognizes private, collective, and state possession of wealth. Some key principles of the Islamic economic system are that earnings and spending must be through halal means, individuals have a right to property with limits to ensure societal benefit, payment of zakat is compulsory to help the poor, and transactions involving interest are prohibited.
This document provides an overview of Islamic banking, including its foundations and operations. Some key points:
- Islamic banking is based on Islamic principles including prohibitions on riba (interest) and gharar (excessive uncertainty). It aims to be just and share risks/rewards between financiers and users of funds.
- Common Islamic financing modes include profit/loss sharing arrangements, trade-based modes like murabaha and ijara, and leasing. Funds are mobilized from deposits and utilized through various Sharia-compliant investments and projects.
- Islamic banks first emerged in the 1970s and have grown significantly since. They operate similarly to conventional banks but use Islamic financing structures. The Islamic
1. Islamic economic system aims to achieve socio-economic justice and fair distribution of wealth through its elaborate system of Zakat and Sadaqat.
2. It establishes brotherhood and unity among Muslims while also discouraging hoarding and ensuring constant circulation of wealth.
3. The system eliminates exploitation and aims to provide basic necessities of life for all citizens through principles of permissible (halal) and impermissible (haram) means as well as moderation in production, consumption, and spending.
This document provides an introduction and overview of the analytical study of the Islamic economic system by Dr. Monzer Kahf. It discusses the methodology of Islamic economics, distinguishing it from Islamic business law. The study aims to build a general theory of the functioning Islamic economy by analyzing the interrelationships between its components and examining its internal consistency. It also notes the lack of studies on the history of Islamic economic thought and the need for research in this area. The introduction outlines the contents and scope of the six chapters to follow, which will cover topics like consumption theory, production theory, the market structure, and the macroeconomic model and policy implications of the Islamic economy.
1. The document discusses the key concepts and principles of Islamic economics according to Islamic scholars and sources. It outlines definitions of Islamic economics, its basic principles, objectives, and differences from Western economics.
2. Sources of Islamic economics are discussed including the Quran, hadiths, ijma, and ijtihad. Important concepts like consumption and savings, the role of the state, money, and Islamic development banks are also summarized.
3. The emergence and early contributors to Islamic economics are highlighted, with significant focus on the work and theories of the prominent Muslim scholar Ibn Khaldun, considered a pioneer in various economic fields like labor, value, demand, taxation and is viewed as a founder of Islamic economics
This document provides an overview of the Islamic financial system. It begins with some background on the rise of globalization and different cultures attempting to contribute to the international business world. The author then discusses two challenges in writing about the Islamic financial system: 1) the religious background and 2) it not being a single, unified system. The rest of the document covers an introduction to Islam, common principles of Islamic finance like contractual fairness and social justice, prohibited transactions, modes of financing, and challenges facing Islamic finance.
This document provides an overview of the Islamic financial system. It begins with some background on the rise of globalization and different cultures attempting to contribute to the international business world. The author notes that the Islamic financial system was one such attempt to add Islamic beliefs and principles.
The author then discusses some of the challenges in writing about the Islamic financial system, such as differing applications across countries and the religious aspects. The rest of the document outlines what will be covered, including an introduction to Islam, common principles of Islamic finance, prohibited transactions, financing modes, and challenges. It provides some high-level context on the roots and goals of the Islamic financial system in adhering to Islamic law and principles.
Islamic economics is based on principles derived from the Quran and Sunnah to prevent injustice and provide for human needs and obligations to Allah. Key principles include:
1) Man is Allah's vicegerent on Earth and must follow His guidelines in all aspects of life.
2) Resources are a trust from Allah and all humans have an equal right to acquire them through righteous means.
3) Economic activity such as production, distribution and consumption is guided to prioritize necessities and balance individual and social interests.
The document discusses the history and evolution of money and monetary systems from ancient times to modern times. It notes that gold and silver coins were widely used as currencies historically. It describes the transition to paper money backed by gold or silver, then the removal of the gold standard and use of fiat currencies not backed by commodities. This led to greater instability, devaluations, and inflation. The Bretton Woods system tied currencies to the US dollar and gold but collapsed in the 1970s, ending the convertibility of dollars to gold and contributing to currency value fluctuations.
Maqasid alshariah in islamic finance an overviewArab Muslim
This document provides an overview of Maqasid al-Shari'ah (objectives of Shariah) and its role in Islamic finance. It defines Maqasid al-Shari'ah as representing the objectives and rationale behind Shariah rulings. Scholars have classified Maqasid al-Shari'ah into essentials, needs and embellishments. The key objectives are protecting religion, life, intellect, lineage and wealth. Maqasid al-Shari'ah aims to promote public interest and welfare by endorsing benefits, educating individuals, and establishing justice. It argues that realizing Maqasid al-Shari'ah is important for the continued development of
Islam and Supply-Side EconomicsSupply-side economics has a long hi.pdfarihanthtoysandgifts
Islam and Supply-Side Economics
Supply-side economics has a long history, dating back to at least the fourteenth century. The
greatest of medieval historians, Abu Zayd Abd-ar-Rahman Ibn Khaldun (1332–1406), included
in his book, The Muqaddimah (1377), an Islamic view of supply-side economics. He pointed out
that “when tax assessments . . . upon the subjects are low, the latter have the energy and desire to
do things. Cultural enterprises grow and increase . . . (Therefore) the number of individual
imposts (taxes) and assessments mounts.” If taxes are increased in both size and rates, “the result
is that the interests of subjects in cultural enterprises disappears, because when they compare
expenditures and taxes with their income and gain and see little profit they make, they lose all
hope.” Ibn Khaldun concluded that “at the beginning of a dynasty, taxation yields large revenue
from small assessments. At the end of a dynasty, taxation yields small revenue from large
assessments.”
(A) How do this Islamic scholar’s theories apply to the modern world?
Solution
Ans:
In the course of the most recent 50 years there has been reestablished enthusiasm for Islamic
nations in looking at the relationship in the middle of Islam and science in the range of its
history. In the wake of picking up autonomy the majority of the Islamic nations have been
attempting to deal with their religious convictions and the Western ideas of science and training.
The instruction frameworks embraced by the greater part of the Islamic nations have been
founded on supposed common Western training. Subsequently a social dichotomy is seen in their
social orders between a conventional Islamic training from one viewpoint confined to religious
gatherings, and a common Western instruction in standard schools, schools and colleges.
Training is seen as a method for securing logical learning and innovation, so as to advance
monetarily in the cutting edge world. On the other hand, training has unsuccessfully attempted to
mix Islamic thinking with this Western instruction framework.
Islamic Nature view :
The Islamic perspective of nature amid the Golden Age was for humankind \'to study nature with
a specific end goal to find God and to utilize nature for the advantage of humanity\'. Nature
could be utilized to give sustenance to humankind and its abundance was to be similarly
circulated among all people groups. All exercises that made damage humanity and thus
devastated nature were illegal. Devastation of the common equalization was disheartened, for
instance, pointless executing of creatures or evacuation of vegetation may thus prompt starvation
because of absence of nourishment. This perspective was an expansion of the thought that
\"man\" had been set on earth as God\'s illustrative.
Supply-side financial aspects is a macroeconomic hypothesis which contends that monetary
development can be most adequately made by putting resources into capital, and by bringing
down boundaries on the .
Maqasid al shariah in islamic finance an overviewMARA
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Al ghazali Thought in Economy
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1.0 INTRODUCTION
Al- Ghazali or the real name, Abu Hamid Mohammad Ibn Mohammad al- Ghazali was
actually born in 450 A.H at Tusk which is located in contemporary Iran. He was
orphaned in the early stage of his life and his education was left to a sufi which is
Muslim mystic who was a friend of his father. Then, in his life, al- Ghazali left tusk to
study with Imam al- Haramayn al – Juwaini who was a leading figure of the Asharite
doctrine which is situated in Niisabur. At the death of Imam al- Haramayn al- Juwaini, al-
Ghazali was already an accomplished scholars mastering various that is Fiqh, Usul al -
fiqh, kalam, philosophy and logic. Moreover, al- Ghazali also was a theologian, philosopher,
jurist and also had been known as one of the most prominent Muslim scholars who
have contributed in the area of Islamic economy.
For the contribution in Islamic economy thoughts, is actually due to the his
mastery in the Islamic sciences as well as the secular disciplines of his times which is
gave him the opportunity to get more deep insights on the issues that he used to
discuss. To al- Ghazali, economic activity could be a means to attain the highest level of
“ al- Muqarrabun” if they are carried out within a normative framework that he outlined
with some details. The economic thoughts of al- Ghazali was not elaborated in special
treatises, such an isolated treatment of a specific field of human affairs would hardly
have been compatible with the principle of learning at the times Further, al- Ghazali
mixes, philosophical, religious, sociological, ethical and economic considerations into his
writings. However, this meaning of basic needs is flexible and may be more inclusive,
that is depending upon conditions prevalent in a given society and at a given time, but
consistent with the Islamic shariah, which is exactly based on the Al- quran and hadith.
Indeed, according to al- Ghazali, the list may include such economic and socio-
physiological needs as furnishings, property, status and prestige and even marital relations,
in additions to the aforementioned basic needs.
For the deep knowledge about Islamic economy thoughts by al- Ghazali, will be
discussed in this assignment which is include, the sources of hukm and merit taken by
al- Ghazali in describing about the economy, the humankind economy activity by al-
Ghazali, and also ethics of economy that had taken by al- Ghazali.
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2.0 THE SOURCES OF HUKUM IN ECONOMY TAKEN BY AL-GHAZALI
Normally, the Islamic ulamak taken the Quran and hadith as the main references in describing
their analysis and when solving any matter in their decision. Al-Ghazali too, in deducting any
views in economy, he was inducted (istiqraa) from many verses in the Quran besides refer to the
Prophet’s hadith and rely to the critical analysis that will effecting the society during his time.
His though remain maintain to religion views even in economy line. He try to understand
well in economy activity which allowed in Islam for example, refer to Surah Al-Jumu’ah and
Surah An-Naba’ which Allah SWT stated that human can involve in both religious and world
activities.
“And when the prayer has been concluded, disperse within the land and seek the bounty of Allah
SWT, and remember Allah SWT often that you may succeed”.
Al-Quran (Al-Jumu’ah:10)
“And we have made the day for livelihood”.
Al-Quran (An-Naba’:11)
Al-Ghazali also refer to any related hadith about economy which supporting the Muslim to get
involve in business activities and perform actively to achieve the success in the world and
hereafter.
The Prophet Muhammad saw said: The truthful tradesmen will resurrect on the Resurrection
Day with the truthful (siddiqin) and the martyrs (shuhadaa).
Besides, he was put some possible objectives of why human naturally engage in economy
activities as the sources in this economy activities. The first is to improve the necessary live hood
which is not only for oneself but also to the family. In his analysis, human basically will try to
satisfy their need starting from economy self-sufficiency then develop to the barter system. His
possible objective is to increase the wealth which can be classified as the modern economic aim
which only can be achieve the public welfare if follow the shariah law.
So, here we can see that Al –Ghazali is a careful jurist in describing his views about
certain issue including about economy by refer to Quran and hadith in his sources.
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3.0 HUMANKIND ECONOMY ACTIVITIES BY AL- GHAZALI
The central focus of Imam al-Ghazali, a great philosopher and sufi, was Islamic philosophy and
Islamic ethical values, which compass all dimensions of life including economics. He states in
al-Ghazali, Ihya, Vol. 2, 62 that “Earning is not the aim of human life but it is a means to an
end.” In this topic, we are going to discuss more deeply about the humankind of economics
activity by him. We also try to explore relevance and application of al-Ghazali’s ideas in the
modern period.
3.1 Economic Philosophy
One of the overriding concepts of al-Ghazali based upon Shariah which encompasses all
human activities, including economic, is ‘maṣlaḥa’ which promotes social welfare of
community. All matters and activities of human being have to be seen as a means to
achieve goals in increasing the social welfare. It is well defined by Al Ghazali,
concerning individual as well as social needs. There are five compulsory Shariah based
on his thought as components for a proper and just individual and social life such din
(religion), nafs (life of soul), naṣl (family), mal (wealth) and ‘aql ( intellect, reason).
Maṣlaḥa is related to Shariah, which key objective is follow what is according to
the Quran perceived as good in the worldly life and Hereafter. Thus the noblest deed in
the sight of Allah is the promotion of general good in the society. Al Ghazali discusses
three aspects of maṣlaḥa in a hierarchical form: necessities (ḍarurriyat), conveniences or
comforts (ḥajiyyat), and refinements or luxuries (taḥsaniyyat).These foundations have to
be constantly revised by the people themselves.
The second foundation comprises “all activities and things that are not vital to
the preservation of the five foundations, but, rather, are needed to relieve or remove
impediments and difficulties in life”, whereas the third foundation includes activities that
are perceived as a surplus or additional to the basic necessities.
3.2 IslamicEconomics:TheNotionofHereafter,BasicNeeds,SharingAndJustConduct
As we mention before, one of the concepts of Al Ghazali based upon Shariah which
encompasses all human activities, which promotes social welfare of community. But,
since Al Ghazali positions economic activities within the parameters of the Islamic
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worldview, the Hereafter is seen as the ultimate goal of human beings. There are
evidence from Quranic verse:
“But seek, through that which Allah has given you, the home of the Hereafter; and [yet],
do not forget your share of the world. And do good as Allah has done good to you. And
desire not corruption in the land. Indeed, Allah does not like corrupters."
Al-Quran (Surah Al-Qaṣaṣ:77)
From this verse we can be understood in the light of not neglecting one’s share or
contribution or effort in this world for the Hereafter. On the other hand, duniawi or
worldly life is seen primarily as a temporal place but rather a struggle and preparation for
the salvation and this struggle has to be utilized through human endeavors and affairs,
which include also the economic pursuits. Thus, economic activity is a prerequisite for
the salvation.
Level of consumption thus has to range between necessity and extravagance.
Whilst necessity has to be fulfilled by the consumer for it is perceived as a religious
obligation, extravagance is haram. According the Al Ghazali all economic activities have
to provide basic human needs such food, clothing, and shelter. These needs are consistent
with Shariah, thus Al Ghazali tries to deliver information from his economic inquiry of
various material matters that relate to provide and please human conditions, as part of the
idea of Islamic social welfare. In Mizan al ‘Amal, al-Ghazali mentions three levels of
consumption which are the lowest, middle, and highest, Each of the basic things can be
applied to each of the three levels as a necessity, convenience or luxury. His discussion
on need and surplus of material things is linked with the percept of the relation between
wealth and poverty.
In order to reach the state of content, basic human needs are what one needs.
Muslim ought to sharing and also humanitarian charity endowment (waqf) to prevent
disproportionate upsurge of income in a society. There are two stages of sharing:
1. A lower stage (a person sacrifices without expecting return)
2. A higher level (presupposes that a person considers his brother as himself and
spends upon him as if he would spend on himself)
Thus, al-Ghazali states that money has been created for a specific purpose in order
to fulfill needs of human beings. Miserliness means that where money should be spent is
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restricted, whilst extravagance suggests the opposite, where money should not be spent,
there is an excessive expenditure of it. Accordance Islamic jurisprudence not only one’s
welfare was secure but the procedure of spending on lawful products in a lawful way.
Misuse of monetary activities would be minimized due to the regulations of Shariah. The
Quran encourages the acquisition of wealth. Therefore, all stages have to be realized not
for the sake of acquiring wealth but in the name of Allah.
4.0 ETHICS OF ECONOMIC BY IMAM AL-GHAZALI THOUGHT
4.1 Meaning of ethics based on al- Ghazali
According to Al-Ghazali, ethics has a central place in this religion of Islam, he states that
“nobody should forget religion and hereafter when his make a trade, commerce earning
live hood. If they do, it shows that they are not wise because they are selling their next
world in this world; but the wise man always try to protect his capital, his real capital;
that is his religion and the matters related to the next world”.
It is clear that a Muslim must keep his virtue when he is making trade. Based on that, we
can say that, there are two parts of categories of behavior in business which is in the first
one is the obligatory status and second part is about the recommended.
4.2 The obligatory of status
In this part, Al-Ghazali found that the Muslims have different attitudes when they are
involve in economic activities and it must be observes. So, there are a few things that we
must follow.
4.2.1 Acquiring the knowledge of the lawful and unlawful about business
Based on Al-Ghazali knowledge whose acquisition is compulsory which is
Muslims must do it and if they are leave or ignored it they can get a punishment.
This compulsory obligations is about the prayer, fasting, and so on.
Besides that, knowing what is lawful and unlawful in matters earnings is
also obligatory on those who involve in such activities. This is based on Shariah
rulings and this will enable them to avoid any unlawful activities or recognize the
issues which need the fatwa of a learned person.
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Hadith the Prophet Muhammad states that “ The research of knowledge is
compulsory on every Muslims”. Al-Ghazali gives more attention for all the
section to explain further about fiqh aspects of the contracts which is confirmed
by Shariah like murabahah, ijarah and so on. Besides that, business that was
carried out through this contracts and what he discussed was the required
knowledge for the businessman.
4.2.2. Formulation of intention
Next is about the formulation of intention that it is will be at the beginning to
determinant of the status of worship. Al-Ghazali states that the worker should
have as intents which is to save himself and his family from depending on others,
to earn what will enable him to perform the various commands of Islam, to
perform the advice in the workplace, to execute his duties with equity and
benevolence and to perform one of the furud kifayah.
4.2.3 Being equitable and avoiding injustice
Al-Ghazali point out different kinds of actions which are harmful to the
individuals and society, even though they are may seem to be acceptable in
appearance. There are hoarding, use of counterfeit coins and telling the truth
about the commodity. Hoarding means hide of some foods or goods from
customer for earn more profit.
According on Al-Ghazali, hoarding of foods stuffs as not prohibited by
Shariah because it causes harm to the public. He takes hadith from Prophet
Muhammad that is, “If a man hoards up foods stuffs when they are hides it for
forty days to get higher price. He is displeased with Allah and Allah is displeased
with him”.
4.3 The recommended category
Al-Ghazali determine a few type of the behaviors that the merchant has adopt towards his
client to get rewards and ranks even they are not compulsory. Because of this action, he
7. GROUP ASSIGNMENT OF BWSE1013 FOUNDATION OF ISLAMIC ECONOMICS
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list up few instructions which aim at preserving the religion of the merchant. The first is
Ihsaan.
Ihsan should be happen in different ways and different stages of the transactions
such as for pricing because it will take greater profit and it is unlawful. So that, the buyer
must avoided the seller who is take advantage above them. Another that is relate with the
debt. The lender should demand in a good manner and grant time when realizing the
dues.
According by Al-Ghazali, practicing ihsan for the debtor may be in the form of
clearing the debt before demand, going to the creditor, not to wait for its demand and
paying more than the principal.
Other than that, there are the remaining item of the list instructions by Al-Ghazali
to make the religion of a business man perfect which is let not worldly markets distract
you from the Hereafter markets (mosque), be attached to the zikr of Allah, do not be too
greedy in the markets and in business, keep away from doubtful things even after giving
up unlawful things and adjust accounts of your business with everybody.
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5.0 CONCLUSION
As a conclusion, regarding to the elaborations from the ethics of economy by Al- Ghazali
thoughts, the sources of hukm in economy that taken by the al- ghazali, and the humankind
economics activity by al- ghazali, it is shows that, there is no doubt that al- ghazali is one
of the most prominent Muslim scholars who had contributed in the area of Islamic
economics.
For the ethics of economy by Al- Ghazali, , the meaning of the ethics itself had
strictly firm that a Muslim should keep his virtue when making a trade. Based on this
also, had divided two parts category of behavior in the business which is the obligatory
status and the recommended. The obligatory status included the certain thing that must
be followed . Meanwhile for the recommended strategy, Al- Ghazali had evaluated a
several types behavior that included the ihsan.
Next, for the sources of hukm in economy, Al- Ghazali had taken many verses
from the al- quran and the hadith as the main resources in describing his views in
economy, besides refer to the critical analysis that had effectively affect the community
during this day. For example, Al- Ghazali, had taken the verses from the Surah al-
Jumu’ah and al- Naba’. Moreover, Al- Ghazali also refer to related hadith to support the
Muslim to get involves in economy and business activity.
Furthermore, for the humankind economy activity, Al- Ghazali had encompasses all
human activity which had included the maslaha, that promotes the social welfare of
community. This means that, all the human activity that have been done must acts as a
means to increase the social welfare. According to the Al- Ghazali, all economy activity
also must provide the basic human needs such as food, clothes and shelter.
Last but not least, from this three elements, we can evaluate that Al- Ghazali had
really contribute to development of Islamic economy which allowing and give the
benchmark to the Muslim in doing the Islamic economy activity in a permissible and
lawful by the Shariah, which is refer to the al- quran and al- hadith. But it is actually
depend to the individual himself whether to follow or not, this is because, not many from
the people who had involved in business are following the Shariah legal ruling.
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6.0 REFERENCES
Internet
Abdou Diaw (April 2009), Imam Al-Ghazali’s Views on Economic Activities, retriview at
2.10 am, 7 April 2014, from http://mpra.ub.uni-muenchen.de/32515/1/IMAM_AL-
GHAZALIS_VIEWS_ON_ECONOMIC_ACTIVITIES.pdf
Hashim W. A. (2009, September 12). Islamic economic thought: Al-Ghazali on economic
issues. retrieved 22 April 2014, from
http://islamiceconomicthought.blogspot.com/2009/09/al-ghazali-on-economic-
issues.html
Daghistani. S. A. (2012, July 1). Ethics and economy in islam: contribution of imam al
ghazali in focus. retrieved 22 April 2014, from http://kud-logos.si/2012/07/01/al-ghazali-
islamic-philosophy-of-economics/
Islamic Economy Thoughts Of Imam Al- Ghazali. Retrieved : 27 March 2014,
From, http://islamiceconomy.net/al-ghazali/
Book
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