History of Islamic Economic Thought

History of Islamic Economic Thought

Contributions of Muslim Scholars to Economic Thought and Analysis

Abdul Azim Islahi

This unique book highlights the contributions made by Muslim scholars to economic thought throughout history, a topic that has received relatively little attention in mainstream economics. Abdul Azim Islahi discusses various ways in which Muslim ideas reached the European West, influencing scholars and helping to form the foundations of modern economic ideas and theories.

Chapter 5: The Islamic tradition in economic thought (iii): money and interest

Abdul Azim Islahi

Subjects: economics and finance, history of economic thought, islamic economics and finance

Extract

First of all in Islamic history ‘Umar, the second Caliph, expressed his intention to issue money of camel skins. The context is not known. However, he refrained from doing so when apprehensions were expressed that this would lead to extinction of camels (al-Baladhuri, 1983, p. 456). Ahmad bin Hanbal is reported to have said that if people adopt something as money, it should be acceptable (Ibn Qudamah, 1972, Vol. 4, p. 176). Ibn Battutah1 (1968, p. 618) noted in his travel account during the eighth/fourteenth century that the Chinese were using paper money for their sale and purchase. But the Muslim scholars did not develop thinking on this line, though they accepted that ‘money is not desired for its own sake’2 (al-Ghazali, n.d.[a], Vol. 4, pp. 114–15; Ibn Taymiyah 1963, Vol. 29, p. 472; Ibn al-Qayyim, 1955, Vol. 2, p. 137). Several Muslim scholars discussed the nature and functions of money, merits of bimetallic standard and consequences of bad money and debasement of currency.

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