Islamic Economics is not "Economics"

The science of "Islamic Economics" should be derived directly from Islamic sources (the Qur'an, Sunnah, ijma', and qiyas) to maintain its ontological purity, as Islam provides a complete, holistic framework. It has tauhid as its foundation, integrating the hereafter with the worldly dimensions. This is very different from conventional, secular, materialistic economics. Why?

Because the conventional approach, rooted in (neoclassical) capitalism, which assumes a profit-hungry homos economicus (Smith's invisible hand), is prone to usury, gharar, and exploitation. All of these are fundamentally contrary to the maqasid of sharia (hifz al-mal, hifz al-nafs). This direct derivative of Islam is guaranteed to avoid contamination by Western assumptions, such as maximizing utility without divine ethics.

Epistemologically, derivations from conventional economics borrow from a reductionist positivist methodology (mathematical models, econometrics), ignoring the variables of tawhid (the principle of tawhid), adl (adl), and maslahah (maslahah). This results in an inconsistent hybrid "Islamic economics," for example, where interest rates are disguised as "profit rates," devoid of the essence of sharia. We need a pure derivative of ushul fiqh (Islamic jurisprudence) that applies sharia principles (al-ashlu fil asyya' al-ibahah illa ma harrama), halal-tayyib (lawful and permissible) production, zakat-waqf (alms) distribution, avoiding israf (israf) (Al-A'raf: 31), and achieving falah (welfare in the afterlife and the world). Many studies have shown that the conventional model failed to address the 2008 crisis due to its disregard for morality, while Islam is preventative through the prohibition of gambling (maysir).

This authentic version of Islamic economics will be pragmatic. A pure approach will produce superior, authentic knowledge: empirical, Islamic banking is more resilient post-crisis, and Islamic cooperatives reduce poverty. Mixed derivatives only create contradictions, such as riba-based sukuk or "sharia-ized" conventional insurance, which ultimately erode the community's trust. Pure Islamic knowledge will create a new paradigm, not a patchwork, according to the method of the Salaf (Al-Ghazali, Ihya Ulumuddin). Economics is an act of worship, not an end in itself.

Economics only addresses how humans obtain the necessities of life in this world. Islamic economics is broader and more comprehensive: how to live life in this world while also securing a life in the afterlife. And Allah knows best.

So, if you want to talk about 'Islamic Economics,' forget all the concepts and thoughts of Adam Smith, David Ricardo, Thomas Malthus, and John Stuart Mill. Let's open the Quran, delve into the hadith, and follow the lifestyle of the Prophet Muhammad SAW.

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