Islamic Economy as we believe

We believe that the foregoing discussion is enough to clarify the meaning and purport of
a school of economics and the science of economics, and now we can make clear what
we believe about Islamic economy.

Islamic economy, as we observed in the course of not preceding study, consists of a

school of economics and not the science of economics. Hence, when we say that Islam
has a school of economics, we do not mean that it has the science of economics. Islam
has not come to discover the phenomena of economic life and their causes. That is not its
responsibility. Just as it is not supposed to state the laws of astronomy, it is also not
supposed to state the laws of economics. Islam has come to organize the economic life
and to evolve a system based on social justice.

Islamic economy represents a just system of economic life, but it has nothing to do with
the scientific discovery of the economic relationship as it actually exists. That is what
mean when we say that Islamic economy is a school and not a science.

In other words, if for example, Islam had discussed the causes of the rise in the price of
intrest bearing shares, its discussion would have been scientific, but it has, on the other
hand, evaluated these shares and declared them forbidden. According to it only equal
participation and profit sharing should form the basis of the relationship between
financier and an entrepreneur.

Now as we clearly know the nature of Islamic economy, we can see what prevents the
people from believing that there exists such a thing as Islamic economy.

Most of the people deny the existence of Islamic economy because they do not
differentiate between the science of economics and the school of economics. They ask as
to how there can be an Islamic economy when in Islam there is no such disscussion of
economic problems as conducted by Adam Smith and Ricardo. Islam has made no
mention of the law of diminishing returns, the law of supply and demand and the law of
wages and has not also discussed the general theory of value.

How can the existence of Islamic economy be admitted when it is known that economic
disscussion have developed only during the past four centuries with the efforts of such
pioneers as Adam Smith and the physiocrats and the commercialists who preceded him?

Those who deny the existence of Islamic economy uphold the above arguments. They
seem to be under the impression that we claim the existence of economic disscussion in
Islam.

But after we know the difference between the science of economics and the school of
economics and understand the Islamic economy is a school, no room is left for the denial
of its existence. It is not claimed that islam talks of the law of supply and demand. What
is meant is that Islam has propounded the principles for the organsation of economic life,
and has invited the people to follow them. Hence it is reasonable to believe that Islam has
a seprate system of economy.

Owing to lack of space we do not propose to go into the details of Islamic economy and
to quote extensively from the holy Quran and the traditions of the House of the Prophet
SAWS of Islam. Anyhow, we purpose to throw some light on the methods of the holy
Quran and the traditions in this respect and show how economic theory can be deduced
from the general principles and concepts of Islam.