The next question is why does man in Islam submitted to the rules and regulation sanctioned by God? That is, why must he obey God in conducting economic activities? Why can’t he resort to reason and facts in making resource allocation choices?
The answer lies in the conception of Islam as al-Din. Islam in general means submission. Islam as al-din is also understood as a way of life. Interestingly, one of the meanings of din is indebtedness, i.e. man indebtedness to his Creator. The term din is extracted from the root word dyn. It is this notion of indebtedness that gives deeper meaning to the reason for human economic existence in Islam.
But what is the story behind man indebtedness to God? And what is he supposed to do under such a situation of indebtedness? When a reasonably good man owes someone money, he will not plan to default the loan but to repay it in full. The same applies to a true believer (mukminum), who will definitely pay his debt to God with a true sense of God-consciousness (taqwa)..
According to al-Attas, in Islam man is indebted to God, his Creator and Provider, for bringing him into existence and maintaining him in his existence. Man who once did not exist is given life and existence by God.
On this point, the Quran states, “Man, We did create from a quintessence of clay. Then We placed him as a drop of sperm in a place of rest, firmly fixed. Then We made the sperm into a clot of congealed blood; then out of that clot We made a lump; then We made out of that lump bones and clothed the bones with fresh; then We developed out of it another creature. So blessed be God, the Best to create”. (Al-Mu’minun {23}:12-14).
When man is indebted to God for giving him life, in what way can he repay the debt? As God is in no dire need of anything since He is the Creator and Sustainer, it quite difficult to gauge how can man give his life back to God? Does it mean that man have to commit suicide to pay off his debt?
In Islam, al-Attas says that paying or returning the debt to God means to give himself up in service, or khidmah to Him, to abase himself before Him, to consciously enslaves himself to His Commands, Prohibitions and Ordinances and thus to live out the dictates of His Law.
It is clearly seen now that man’s existence is explained by the debt he owes God and his subsequent enslavement to His law as a means of repayment. Man himself is the object of the debt. In fact the Covenant (Al-Mithaq) that man sealed with God, when He says, ‘Am I not your Lord”, (alastuburabbikum) and man’s true self testifying, answered: Yea!” We do testify (balashahidna), requires man to manifest the Covenant (Al-Mithaq) by way of submitting his desires to His Will (i.e. the Shariah) in absolute true willingness.
The question now – is how this meaning of indebtedness and the concept of Al-Mithaq become significant in explaining the meaning of human economic existence?
Recalling the four basic economic problems of mainstream economics namely, resource allocation, distribution, economic stability and growth, we see the issue is not only about what rules and techniques one can use to solve problems, but most importantly who determines these rules in the first place?
That is, to help solve the pressing problem of poverty, unemployment, inflation, environmental degradation, etc, one’s belief must be based on a strong value system whose basis is divine. In this respect, the mainstream economics did not recognize the role of revelation in determining economic values. It identifies reason and sense experience as the determinant of right and wrong. Economists called these right and wrong as utility and disutility.
It can be seen now that Islamic economics remains the study of choice. Due to scarcity, man has to make choices as he cannot have everything he desires. To make the correct choice, man must driven by knowledge. There are two types of knowledge one can use in making economic choices. The first type is knowledge derived from the Quran and Tradition. This is Divine knowledge and embodied in the economic system. The second type of knowledge is that derived from reason and sense experience known as economic theory. In a sense, economic theory explains and predict but only possible when an economic system is in place.
Islamic banking and finance is a specialization in Islamic economics. It deals with the problem of choice dealing with the demand and supply of capital as a factor of production. For example, in sourcing deposits, an Islamic bank cannot use interest (riba) to pay depositors. This is a Divine requirement as Islam prohibits the payment and receipts of interest. However, by using reason and facts, one can further understand and measure demand and supply behaviour of Muslims investors. The demand and supply determinants help explain the factors affecting behaviour of depositors and fund users. These factors can be divinely inspired or simply mundane in nature. For example, zuhd (moderation) tendencies (i.e divine) can increase the supply of capital but an increase in corporate earnings (i.e. mundane) can also increase the supply of capital.
Finally, economics as a study of choice logically looks at a problem of choice dealing with goods and services that society valued. In other words, the problem of choice is about choosing what is good (khair) only. In Islam, choice or ikhtiyar refers to the selection or identification of goods and services that is deemed permissible (halal) in Islamic law. The choice (ikhtiyar) is made on the basis of Shariah as embodied in the Islamic economic system. That is, while making economic choices man is guided by the Shariah. He must obey and observed the Shariah since the Shariah will lead him to
You say that how man makes choices must be guided by the Shariah. In my view, choices of individuals affect and drive the change of the whole economy. The working of the economy affects the society as a whole e.g. how poor is the poor, how many free time people have and what do they do with it.
Please forgive me my ignorance if i am wrong, but as i know, the explicit laws of shariah are not rigid, but constantly changing to an extent through discussions as society changes. So, at the end, Shariah drives the choices of man, and in response, individual choices affect the Shariah. Are there any thoughts about that relationship or is it very obscure and far?
Thank you very much.
Under fiqhi terms, Islam, as a norm, guides the change of society. Islam itself isn’t static, but its dynamics also has corridors. Islam highly regards cultures, and it has to be emphasized that Islam and Arab culture are two different concepts. As long as the cultures, wherever they reside, aren’t contrary with the sharia, it’s fine. Thus by the definition, Islam isn’t powerless dogma that could only watch the world changing. And Muslims have the obligation to implement shariah within Muslims world and hopefully spread the light for the whole world. This is one among highly discussed topics about shariah and shariah economics, we will proceed with more elaborated topic in the near future. Thank you.