ISLAMIC ECONOMIC SYSTEM
Today we will tell you about Islamic Economics System. Please read this post carefully so that you understand everything about Islamic Economics System. We have already told you about capitalism, socialism, mixed economy, but now we are going to tell you about the Islamic economic system. The Islamic economic system is very different from other economic systems because it has the concept of zakat and the concept of ushar, the concept of fitra and there are many more concepts that are not in other economic systems. In this economic system, there is an incentive to help the poor in every possible way.
Islam offers a definite economic system based on zakat, ushr, baitulmal, dignity of labor, equality, interest free Economy, justifiable income, and observing rights and duties.
What is the Islamic Economic System:
in the Islam Economy system all the economic activities like production of wealth, consumption of wealth, and distribution of wealth are according to the law of shariah. Islam is a complete code of life and it provides guidance to men in every field of life.
Characteristics of the Islamic Economy system:
The following are the main features of the Islamic Economy.
The religion recommends the establishment of the baptismal, whose source of income are as follows:
Zakat / Ushr:
Zakat is the backbone of the Islamic economic system “According to the HOLY PROPHET (P.B.U.H) zakat is the treasury of Islam.” zakat is received from those Muslim who are “sahib-e-hesab“. it is distributed among the poor. It plays a very important role in removing inequality of wealth and poverty.
According to Islam it is compulsory for every Muslim to pay fitra. Irrespective of his or her age it should be paid once in a year on the occasion of EID-UL-FITER before EID prayers. in this way, money is circulated not concentrated in a few hands.
Interest is prohibit in the Islamic economic system. MODARBA, MUSHARIKA; profit and loss sharing system has been introduced in Islam.
Principle Of Wealth Consumption:
In the case of consumption Islam allows one to spend but it does not allow anyone to be spendthrift, neither it allows “BUKHLE” nor “ASRAF“. It shows the way of moderation.
Order Of Social Welfare:
It is a completely welfare system. Islam encourages to spend money and discourages the collection of wealth according to shariah is not better for one person that neither he uses the money nor he gives it to others. In Islamic society excess money is given to the poor and needy people in the shape of “sadqa” and “khairat“, In this way the Islamic economic system is very useful to remove poverty.
Right Of Private Property:
Under the Islamic economic system, everyone can purchase, consume, and exchange private property within the laws of shariah.
Everyone is free to any business. He likes every person to adopt any profession but it should be according to shariah.
Concept Of Hallal And Haram:
Anything is permissible according to the Islam shariah is called Hallal. Anything, which is prohibit according to Islamic shariah is call haram. In the Islamic economic system, some limitation is imposed on the earning of wealth.
Role Of State:
In the Islamic state, it is the duty of the government that it provides justice to people. It pays proper attention to public welfare and provides security. It is not a profit earning institution.
Consumer Is A King:
In the Islamic economic system, producers produce the commodities according to the demand of the consumer. So we can say that the consumer is compare as a king.
Islam emphasizes human and individual freedom. Unnecessary restrictions are discourage. Every individual enjoys the right to work or do business. Business is disallowing only to prohibit goods and services. Islam guarantees all human rights.
Transfer Of Wealth:
Wealth is only transferable under the following conditions:
- Work or business
Transfer by other means is disallowe. In other words, bribery, interest, black marketing, and theft are forbidden.
Dignity Of Labor:
The religion focuses due to attention on labor. Every legal work is recognize and people are asked to do work to earn their live hood. Islam is the champion of the dignity of labor.
ISLAMIC ECONOMIC SYSTEM IS SUPERIOR TO SOCIALISM AND CAPITALISM
All other economic systems, except Islamic Economic System, have been designed by human thoughts while Islamic Economic System has been bestowed upon human society by Allah through the Holy Quran and the Sunnah (acts) of Muhammad (P.B.U.H.). This is the reason that the Islamic Economic System is quite different than the other systems.
Capitalist says “Economic freedom” to producers and consumers Equality” achieved through state ownership of the means of production. The distinguishing characteristic of an Islamic Economic System is ” Economic and Social Justice”. So that everybody gets his/her dues.
The Concept Of Private Property:
In a capitalist system unlimited liberty and right of ownership for private property are given which has result in the capitalist exploitation of workers. In a socialist system, private property is not allowed.
Consumption Of Wealth:
capitalism anything can be consume. While in a socialist society only consumer goods and services are allowe to be produce in the country. In Islamic countries, only “Halals” are allow to be produce and consume “Haram” goods and services are not allowed to be produced and consumed.
Production Of Wealth:
The capitalist motive is only profit so they produce goods for only profit. In a socialist society, the central planning authority made a decision about what to produce and how much to produce. But In the Islamic Economic System “Haram” goods are not allow.
Distribution Of Wealth:
Capitalism concentration of wealth is in few hands due to the unlimite right of ownership and free competition. In socialism no one can own private property, All wealth is concentrate with the government. In the Islamic Economic System, due to “Zakat” and “Sadat” automatically wealth transfers to the poor from the rich.
The Role Of Interest:
The interest made and brings equilibrium between saying and investment to promote capital formation in a capitalist society. In socialism, interest does not play any role in saving and investment. In the Islamic Economic System, interest-base economic activities are strictly ban. Hence interest is not a source of capital formation in an Islamic Economic System, Now a days world economic recession and downfall of the American banking system is just because of the evils of interest.
We conclude that Capitalist and socialists are materialistic in nature and they only looking to satisfy the material wants of the people. But, Islamic Économic System provides a fine blend of materialism and spiritualism. I hope you like our post on our Islamic economic system. If you like it, please visit our more post.