Islam & Socialism

IBM 11013
Introduction to Islamic Economics
Lecturer in charge
RA. Sarjoon

Islam and Socialism

There

are so many problems facing by the

human being, economic is the one of them
and its significance cannot be denied in the
life of human being.
In the very beginning it was said that
economic problem is due to the scarcity.
1 economics of production
2 economics of distribution

Islam and Socialism

Economics & Its Problems

What is economics?
To utilize the limited resources in a way that maximum needs and wants
are met to ensure the well being of all members of the human society.

The four basic economic problems:

1.
2.
3.
4.

Determination of Priorities
Allocation of Resources (Land, Labor, Capital, Entrepreneur)
Distribution of Income
Development

We will compare how Capitalism, Socialism and Islamic Economic system

addresses to these problems.

Islam and Socialism

The pattern of economic institutions and organization in various countries is not the
same.

There is difference in relations of different groups of people and also, the strategies
to solve basic economic problems of the society are not the same.

These problems do not have only one solution. Alternative ways or alternative
systems exist in this regard.

If we look around the world from the point of view of an economist, we find that
although in every country economic conditions are different, yet they can be grouped
into a few broad categories or economic systems under which they solve their basic
problems of 'how, what' and 'for whom. Every economic system has some unusual
features, which distinguish it from others. These systems have been names as:
1)Capitalism
2)Socialism
3)Islamic Economic System

Islam and Socialism

Socialism
Socialism

does not have a common

meaning. Different people include different
things in it. However the basic thinking is the
same, i.e.;
the government should have control over
economic activities, and private ownership of
land and capital abolished or put under tight
restrictions.
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Islam and Socialism

What is Socialism?
Socialism:

A political and economic theory

that a countrys land, transport, natural
resources and chief industries should be
owned and control by the whole community
or by the state, and the wealth should be
equally distributed.

Islam and Socialism

Socialism
Thus

we can say that,

socialism is a system under which all capital
and natural resources are owned by the state
and all production is certainly planed as if the
whole economy is one big firm.

Islam and Socialism

Socialism Definition

Dickinson defines it as,

Socialism is an economic organization of society, in
which the material means of production are owned
by the whole community and operated by the organs,
representative of, and responsible to the community,
according to a general plan; all members of the
community are being entitle to have equal benefit
from the resulting production.

Islam and Socialism

Socialism Terminology
The

term Socialism or Socialist can refer to

several related things:
An ideology or a group of ideologies,
a state that exists or has existed.
In Marxist theory:
the society that would succeed capitalism,
and then develop further into communism.
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Islam and Socialism

Historical Background

Industrial Revolutions

10

Threw thousands of handcraft workers into the labor Market

Crowed slum were established around the factories
Crimes, disease, hunger and misery were a way of life
Industrial accident and no compensation for families
No Rights of wage earner
Union were illegal

Islam and Socialism

Types of Socialism
Utopian

Socialism
State Socialism
Christian Socialism
Anarchism
Marxian Socialism
Communism

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Islam and Socialism

12

Social Justice

Better allocation of resources

Improving productive efficiency

Social security and welfare

Economic stability
Islam and Socialism

Lake

of incentive or encouragement

Maladjustment
Profit

and loss

Private

property

Bureaucracy
Not

monopoly of

successful in business

Insufficient

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in the demand and supply

resources
Islam and Socialism

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Misallocation of resources

Lake of consumer sovereignty

Loss of economic freedom

Economic equality not achieved

Concentration of power in the state

Islam and Socialism

Islamic Economics System

According to Quaranic verses, every thing in this universe
belongs to God almighty.
"Whatever is in the heavens and whatever is in the earth
belongs to Allah." [Al-Baqarah, 2:284].
He is the real owner of everything
"And Allahs is the kingdom
of the heavens and the earth, and Allah has power over
every things." [Al- Imran, 3:189].

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Islam and Socialism

Islamic Economics System

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Halal & Haram

Justice

Equality

Cooperation

Brotherhood

Benevolence
Islam and Socialism

Solution for Economics Problems

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Basic rules of Islam

Naturally

Concentration on ethics and morality

The role of government where required

Islam and Socialism

Solution for Economics Problems

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Achieving wealth

Rights of ownership

How to use that Rights?

utilization of capital

Distribution of wealth [

Islam and Socialism

Teaching of the Qur,an Regarding

Economics
Wright

of private ownership
)(
)......(
No concept of equality in economics
Allah says
)..(
No priesthood
)( Allah says
Islam and Socialism

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Teaching of the Qur,an Regarding

Economics
Distinction between legal and illegal

Exaggeration is not allowed

How to spend?
The concept of zakat
Spoils of war
The concept of Islam regarding inheritance
The concept of public property
,,

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Islam and Socialism

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Islam and Socialism