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Scarcity, self-interest and maximization from Islamic angle

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  • Hasan, Zubair

Abstract

This paper clarifies some misinterpretations of three foundational concepts in mainstream economics from Islamic viewpoint. These are scarcity of resources, pursuit of self-interest and maximizing behavior of economic agents. It argues that stocks of resources that God has provided are inexhaustible. But important is the availability of resources out of stocks to mankind. Availability is a function of human effort and the state of knowledge about resources over time and space. In that sense resources are scarce in relation to multiplicity of human wants for Islamic economics as well. Self-interest must be distinguished from selfishness. The motive operates on both ends of human existence: mundane and spiritual. Its pursuit does not preclude altruism from human life. Counter interests keep balance in society and promote civility. Islam recognizes the motive as valid. Maximization relates to quantifiable ex ante variables. Uncertainty of future outcomes of actions makes maximization a heuristic but useful analytical tool. The concept is value neutral. What is maximized, how and to what end alone give rise to moral issues. Modified in the light of Shari’ah requirements the three concepts can provide a firmer definition for Islamic economics centered on the notion of falah.

Suggested Citation

  • Hasan, Zubair, 2011. "Scarcity, self-interest and maximization from Islamic angle," MPRA Paper 29414, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:29414
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    File URL: https://mpra.ub.uni-muenchen.de/29414/1/MPRA_paper_29414.pdf
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    References listed on IDEAS

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    1. Coase, R H, 1976. "Adam Smith's Views of Man," Journal of Law and Economics, University of Chicago Press, vol. 19(3), pages 529-546, October.
    2. Addas, Waleed A.J., 2008. "Methodology of Economics: Secular Versus Islamic," MPRA Paper 8264, University Library of Munich, Germany.
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    Cited by:

    1. Hasan, Zubair, 2016. "Evolution of Islamic Economics:Definition, nature, methodology, problems and challenges," MPRA Paper 71858, University Library of Munich, Germany.
    2. Aydin, Necati, 2013. "Redefining Islamic Economics as a New Economic Paradigm," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 21, pages 1-34.
    3. Murat Çokgezen, 2016. "Islamic economics in real life: Do Muslims give more than the others?," Working Papers hal-01349872, HAL.

    More about this item

    Keywords

    Scarcity; self-interest; maximization; Islamic Economics; israf; Shri'ah; heuristics;

    JEL classification:

    • B10 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - General
    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
    • B13 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Neoclassical through 1925 (Austrian, Marshallian, Walrasian, Wicksellian)

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