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» Your Corner: A lessonfrom 14th Century...
27 August 2010 [10:45] -
"Your Corner" is exactly what you think it is - your stories, pictures, art, and pretty much everything else you can share with the rest.
As part of our "Your Corner"project, one of our regularreaders from Dubai, Rauf Mammadov sent us an interestingarticle about the basic merits of Islamic economics and lessons itcan offer to modern practitioners. According to our reader, duringthe last Annual Meeting of IslamicDevelopment Bank in Baku (held in June 2010), he observedthe lack of knowledge of Islamic economics and finance amongthe Government and private sector officials in Azerbaijan andother CIS countries". Scroll down for the article itself.
A LESSON FROM 14th CENTURY
Recent news on the state of the global economy and theresponse measures adopted by the various Governments,made me recall the President Reagan’s open letter to thePresident Clinton (published on p4 of the International HeraldTribune on 02/21/1993). There were concluding remarks thatattracted my particular attention
“At the beginning of the empire, the tax rates were low and the revenues were high. At the end of the empire, the tax rates were high and the revenues were low”
.Thanks to DELL, Du (local internet provider in Dubai) andGoogle, I realized that President Reagan was quoting from “Muqaddima: An Introduction to the History”, a masterpiecewritten by the 14th century polymath Ibn Khaldun and widelyrecognized as a Bible of Islamic economics. At the time when France and England were engaged in thedevastating Hundred Years War, Ibn Khaldun’s research in thethen quite Andalusia offered probably the first comprehensiveanalysis of how economy and markets function. It also offerscritical thoughts on public governance and societies in general.In doing so, he focuses on the role of the Government andimportance of specialization, and offers his breakthroughthoughts on many modern economic and governance theories.Reading Muqaddima and about it, I was intrigued by IbnKhaldun’s prescription for the prosperity of the nations, whichwere grouped by one scholar (Dr. Selim Karatas) as follows:1. A firm establishment of private property rights and freedomof enterprise;2. Institutionalization of the Rule of law and reliability of judicial system to ensure justice;3. Peace and security of trade routes;4. Low and limited taxation for greater employment, productionand revenues;5. Less bureaucracy supported by small, efficient andprofessional army;6. No government involvement in trade, production andcommercial affairs;7. No fixation of prices;8. Stable monetary policy and independent monetary authoritythat does not play with value of money;