The predicament of economics has also been searchingly examined by a group of leading economists in a valuable study, Economics in the Future: Towards a New Paradigm. The near consensus that emerges in this book is that what is needed to salvage economics from the throes of crisis in which it is caught is not just some new interpretation of this or that economic theory or some changes within the current paradigm of economics, but that the need is to change the paradigm itself and move towards a new paradigm under which economic problems are not studied in isolation but in the context of an entire social system, whose ideals, vision of society and moral values are not hidden, but go to make up the parameters that influence economic decision-making. The modern economy has failed to ensure distributive justice, sustained growth, balanced human development, social harmony and regional equity for a vast majority of mankind and is confronted at home and abroad with the menaces of prolonged recession, persistent unemployment, stagflation, unrestrained monetary expansion, staggering mountains of domestic and foreign debt, and co-existence of extremes of affluence and stark poverty within each country as well as among the community of nations. The link between moral values and economic judgement and behaviour, both at individual as well as governmental levels, which had sustained humanity through the millennia, had been torn asunder during the age of secular capitalistic ascendance and the economists as well as the common man are now trying to re-discover that missing ethical link.
James Robertson, in a very perceptive study, writes: “Unlike both the capitalist and socialist versions of conventional economics, the 21st century economy must be based on recognition that people are moral beings whose freedom as such should not be narrowly bound by impersonal parameters laid down by market and state. The 21st century economy must accept, as an aspect of self-reliance, that people need space in which to exercise moral responsibility and choice in their economic lives. Measures designed to allow this free space to people as individuals, and also to groupings of people in local economies and national economies (especially in the Third World), must be part of the new economic order ... The new economics must thus transcend the materialist assumptions of a conventional economics: that economic life is reducible to production and consumption; that wealth is a kind of product that has to be created before it can be consumed; and that wealth production and wealth consumption are successive stages in a linear process which converts resources into waste. It must reinterpret the manipulative concern of conventional economics with the production and distribution of wealth and the allocation of resources, into a developmental concern with how to enable people to meet their needs, develop themselves, and enhance the resources and qualities of the natural world. It must recognise that because human beings are moral beings the basic questions about economics are moral questions.” (Future Wealth: A New Economics for the 21st Century, Cassell Publications, London, 1990, pp.21–8.)
‘Islamic Economics’ represents a systematic effort by Muslim economists to take a fresh look at the entire economic problem, including the methodology of economics, with a view to coming up with fresh solutions to old and persisting problems. This approach is still in its early phases of growth. We are aware that Muslim economists have a long way to go, but there is no doubt that a beginning has been made in this direction. This beginning bears great promise for the future.
Dr. Umer Chapra is a leading Muslim economist. A Faisal Laureate, his earlier works, particularly, Towards a Just Monetary System and Islam and the Economic Challenge, have established his credentials as a leading intellectual influence in the contemporary Muslim world. Dr. Chapra has blazed a new trail in the present work. The Future of Economics: An Islamic Perspective is a seminal contribution not only to Islamic economic literature, but also to the contemporary economic debate as such. A work of profound scholarship and innovative thinking, it is a powerful yet balanced critique of mainstream economics and makes a forceful plea for taking economics out of its secular and Occident-centred cocoon. He has made a formidable case to re-link economics with moral and egalitarian concerns so as to harness the discipline in the service of humanity. In my view this path-breaking study is characterized, among others, by at least five distinctive features.
Firstly, it is a scholarly and sympathetic critique of mainstream economics, from both the economic as well as moral perspectives. As a professional economist Dr. Chapra is aware of the usefulness as well as the limitations of economics as it has developed in the Western capitalist context. Conscious of the intrinsic value of economic analysis and the contributions it can make towards the amelioration of the human situation on the globe, he identifies the weaknesses that have marred the discipline from playing its rightful role. His approach is not negative, it is positive and creative. He identifies where things have gone wrong and suggests what is needed to set them right. He is not an iconoclast. He is an innovator and a reformer who wants to build on what exists, yet build in a manner that rectifies what has gone wrong. His concern is not confined to the moral and social dimensions, which are crucial to his analysis, but also to strengthen the micro-foundations of economics which need refurbishing to enable them to strengthen the macro-framework and achieve the social objectives.
Secondly, this study makes a systematic effort to bring back the focus of economics onto the question of equity and justice, without weakening the concern for efficiency. The twin objectives of equity and efficiency must go together if economics is to be a science of human well-being and not merely ‘the dismal science of wealth’. Dr. Chapra has done a wonderful job by introducing the concepts of moral filters and by rehabilitating the equity dimension within the matrix of mainstream economics.
Thirdly, Dr. Chapra has meticulously placed Islamic Economics in the landscape of economics. He does not treat Islamic Economics as a separate species. He looks upon the economic problem from an Islamic perspective and as such makes an innovative effort to bring economics in harmony with the Islamic vision and social order. Islam and economics are so intertwined that economics develop a new direction and discover a new world to traverse.
Fourthly, this study makes a brief but succinct and masterly presentation of the state of art of Islamic Economics. Not a survey in the technical sense, it does present an incisive review of major contributions to economics made from an Islamic perspective by Islamic economists during the last century. Although the focus is more on monetary and fiscal aspects, yet Dr. Chapra successfully brings out the flavour of Islamic economic thinking and has identified some of the major avenues it has tried to explore. He is fully conscious of the gaps and challenges, but he very objectively illumines major landmarks in this field.
Finally, this is the first time that an Islamic economist has critically looked into Muslim economic history with a view to throwing light on what has gone wrong with our own history and how real resurgence and sustained socio-economic development can be achieved in the future. He is not satisfied with merely painting a pen-picture of Islamic ideals, values and principles. Drawing upon Ibn Khaldūn he analyzes the causes of economic and political decay and decline, with a view to delineating the path to recovery