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 6: The Islamic tradition in economic thought (iv): state, finance, and development

Abdul Azim Islahi

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


The Prophet of Islam (peace be upon him) transformed the disintegrated and anarchic people of Arabia into citizens of an organized state. He gave the necessary principles of good governance and educated his immediate followers in establishing an ideal state based on justice, equity, mutual consultation [shūrā] and God-consciousness [taqwā]. At the same time, he encouraged people to benefit from good experiences of others. Early writings on political and economic themes started in this free environment. The early writers addressed practical problems arising from the fast expanding Islamic state such as the economic role of government, management of conquered lands, administration of public revenue and expenditure, regulation of markets, provision of necessary supplies, improvement of economic condition of the people and development of economy, etc. The Muslim scholars adopted a pragmatic approach. They freely benefited from writings and experience of other people.

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