Shari‘ah Economics as Autonomous Paradigm: Theoretical Approach and Operative Outcomes

Author (s): 

ABSTRACT

This paper proposes a conceptualization of Shari‘ah economics as a scientific paradigm which is autonomous from the conventional one. To this objective, it addresses both theoretical issues and operative aspects. (1) After a preliminary introduction on the current identity of Shari‘ah economics theory and practice, (2) the first section of the paper focuses on the theory of Shari‘ah economics with reference to the notion of paradigm in epistemology of science. (3) In this regard, the study reviews the ethical approach to Islamic economics and finance (IEF) for its intrinsic incapability to challenge conventional economics as universal paradigm. In fact, by setting an antithesis between homo-Islamicus and homo-economicus, this approach implicitly re-affirms the validity of the ‘universal’, locating Shari‘ah economics, as a ‘particular’ case of ethical investments, in an ana-logical relationship with it, where Islamic values rectify, but do not substitute, conventional rationales (Shari‘ah-compliant economy). (4) On the contrary, moving from an approach ‘universal/particular’ to a perspective ‘one/many’, the paper argues that the autonomy of Shari‘ah economics can be properly recognized by internalising Islamic values within an Islamic economic rationality as intellectual endeavour (ijtihad) aimed at reconciling divine omnipotence and human agency (Shari‘ah-based economy). Marking this turning point, the rationales of Shari‘ah economics are coherently identified through Shari‘ah (Qur’an and Sunna) in (a) the primacy of real economy over finance; (b) the equilibrium in commercial transactions; (c) asset-backed and risk-sharing investment strategies, and conceived as a paradigm which is not based on the division of economic resources (conventional economics), but on sharing goods through participating in the unique divine justice (Shari‘ah economics), and that can be set in a dia-logical relation with the former. From this theoretical shift, the paper derives relevant operative outcomes. (5) While in the approach ‘universal/particular’ Shari‘ah economics, as a ‘particular’, necessarily depends on the ‘universal’ for its elaboration, in a perspective ‘one/many’ IEF stands without a necessary comparison with/dependence on conventional economics. In other terms, since IEF products and services enjoy their own rationales, they can be ‘thought’ as Shari‘ah-based and not simply Shari‘ah-compliant. Accordingly, their configuration does not merely rectify conventional economics, but becomes ‘self-conceivable’ according to their own logical paradigm. On the matter, as practical examples, issues related to Islamic banking regulation and to the admissibility of Islamic derivatives are briefly discussed. (6) Rejecting an ‘ana-logical’ discourse (‘one’ paradigm) in favour of the recognition of ‘many’ autonomous paradigms, the paper concludes by emphasizing the viability of a dia-logical relationship between conventional and Shari‘ah economics, both in the light of the Qur’an and the rejection of a Eurocentric conception of science.

Keywords

Shari‘ah economics; ethical investments; scientific paradigm

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