Generating Research Priorities

Islamic economics was launched by general works on Islamic economic system and the economic philosophy of Islam. With the passage of time, however, new research priorities emerged. By the close of the seventies the theory of Islamic economics, as distinguished from other Islamic sciences and from economics, had its priorities sorted out. There was no denying the fact that Islamic financial institutions were at the top of its agenda.

Next came the teaching of Islamic economics. This in effect was an effort to take the ideas in the above mentioned general works to the classroom. For doing so, these ideas were rearranged in accordance with the conventional arrangement of economics: consumption, production, exchange, distribution, public finance, development, etc. By the end of the seventies most universities in the Arab and Islamic world were teaching some courses in Islamic economics. These were followed by some western universities in the eighties.

With teaching went research. Dozens of doctoral dissertations were produced in the western universities on subjects ranging from Islamic economic doctrines, to Islamic economic system to Islamic banking. The number of dissertations produced in the Arab and Islamic countries would be many times more.

This was a development of great significance to the theory of Islamic economics. Just as the practice of Islamic banking was now providing some feed back to the theory of Islamic banking (which preceded practice), so teaching and research was helping in refinement of concepts and a better formulation of precepts. For the first time theory and practice were able not only to reinforce each other but also to introduce significant changes in each other. The most prominent example is the introduction, in late seventies, of murabahah in an exercise that was earlier supposed to be based mainly on mudarabah.

Source: Dr. Muhammad Nejatullah Siddiqi, Economics An Islamic Approach. Republished with permission.