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Introduction to Islamic Economics: Theory and Application

Book Description

Gain deeper insight into the principles and theory of Islamic economics

Introduction to Islamic Economics: Theory and Application provides an overview of the organizing principles and fundamentals of an Islamic economy. With deep discussion of the characteristics, rationale, key institutions, objectives, and instruments at work, the book addresses the core economic principles underlying a system based on the foundational teachings of Islam, and examines the implications for economic policies. Social welfare, economic justice, market functionality, efficiency, and equity are explored from an Islamic perspective, and the role and instruments of fiscal and monetary policy in Islamic systems are used to illustrate contemporary applications.

Universities around the globe are offering courses on Islamic economics and finance, but despite the industry's rapid growth, most research has been focused on the financial principles rather than underlying economic principles. The first book of its kind, Introduction to Islamic Economics brings all the key concepts together into one reference volume. By outlining the ways in which Islamic finance and Islamic economics interrelate, this book can help readers to:

  • Develop an understanding of the Islamic economic system and its institutional scaffolding

  • Differentiate between the major characteristics of the dominant conventional economy and one based on the fundamental sources of Islam

  • Understand the conditions that must be met for a just, well-balanced, stable, and growing economy

  • Clarify the role of State, public policy, and risk-sharing in the Islamic financial system

  • The Islamic financial system is expanding quickly, and those looking to increase their relevance in a changing economic landscape must get up to speed. Introduction to Islamic Economics provides a comprehensive overview of underlying economic system offering a deeper understanding of the feature of the system. This book is an excellent complement to Introduction to Islamic Finance, 2E by Iqbal and Mirakhor.

    Table of Contents

    1. Cover
    2. Series Page
    3. Title Page
    4. Copyright
    5. Dedication
    6. Acknowledgments
    7. About the Authors
    8. Chapter 1: Economic Systems
      1. What Is an Economic System?
      2. Current State of the Global Economic System
      3. Islamic Economics Paradigm
      4. Short History of Economic Thought in Islam
      5. Summary
      6. Key Terms
      7. Questions
    9. Chapter 2: Foundation of the Islamic Economic Paradigm
      1. Meta-Framework and Archetype of Economic Rules
      2. Implications of the Agent-Trustee Relationship
      3. Significance of Rule Compliance
      4. Impact of Scarcity
      5. Rationality and Freedom of Choice
      6. Individual Obligations, Rights, and Self-Interest
      7. Central Notion of Justice
      8. Shariah: The Law
      9. Summary
      10. Key Terms
      11. Questions
    10. Chapter 3: Institutional Framework and Key Institutions
      1. Key Institutions
      2. Summary
      3. Key Terms
      4. Questions
    11. Chapter 4: The Islamic Economic System
      1. Social and Economic Justice
      2. Prohibition of Interest (Al-Riba)
      3. Risk-Sharing Economic System
      4. Role of the State
      5. Summary
      6. Key Terms
      7. Questions
    12. Chapter 5: Key Microeconomic Concepts
      1. Defining Microeconomics
      2. Issue of Needs Versus Wants
      3. Consumer Behavior
      4. Theory of the Firm
      5. Dynamics of Demand and Supply
      6. Efficiency Versus Equity
      7. Market Models
      8. Role of the State
      9. Summary
      10. Key Terms
      11. Questions
    13. Chapter 6: Key Macroeconomics Concepts
      1. Principal Economic Agents
      2. National Income
      3. Consumption, Savings, Investment, and National Income Determination
      4. National Income and Output Determination
      5. Inflation
      6. Unemployment
      7. Open Economy: Trade in Goods and Services with Other Countries
      8. Why International Trade is so Central to Islam
      9. Summary
      10. Key Terms
      11. Questions
    14. Chapter 7: Macroeconomic Equilibrium: Characteristics of an Islamic Economy1
      1. Models of An Interest-Free Economy
      2. Summary
      3. Key Terms
      4. Questions
      5. Notes
    15. Chapter 8: The Financial System
      1. Notion of Risk Sharing
      2. Building Blocks of the Islamic Financial System
      3. Takaful (Islamic Insurance)
      4. Summary
      5. Key Terms
      6. Questions
    16. Chapter 9: Role of the State and Public Policy
      1. Basic Roles of the State in All Economic Systems
      2. Role of the State in the Islamic Economic System
      3. Policy Instruments of the State in Islam
      4. Economic Justice and Public Policy
      5. Role of Public Policy
      6. Summary
      7. Key Terms
      8. Questions
    17. Chapter 10: Fiscal Policy
      1. Role of Fiscal Policy
      2. Fiscal Policy in an Islamic Economy
      3. Public Finance
      4. Summary
      5. Key Terms
      6. Questions
    18. Chapter 11: Monetary Policy
      1. Role of Monetary Policy
      2. Monetary Policy in an Islamic Economy
      3. Summary
      4. Key Terms
      5. Questions
    19. Chapter 12: Economic Development and Growth
      1. Evolution of Western Economic Thought: From Smith to North and Sen1
      2. Foundation and Framework of Development and Growth in Islam
      3. Islamic Perspective on Financial Inclusion
      4. Summary
      5. Key Terms
      6. Questions
    20. Chapter 13: Economic and Social Welfare
      1. Social Safety Net Provisions
      2. Concept of Safety Net and Welfare
      3. Empirical Evidence on Social Welfare from Select Muslim Countries
      4. Summary
      5. Key Terms
      6. Questions
    21. Chapter 14: Economic State of Affairs in OIC Countries
      1. Public Policy in the Islamic Economic System
      2. Dimensions of Economic and Social Achievements in Muslim Countries
      3. Summary
      4. Key Terms
      5. Questions
    22. Glossary of Arabic Terms
    23. Bibliography
    24. Index
    25. End User License Agreement