By Dr. Abdul Wadud Nafis, LC., MEI
Islamic economics is a system that goes beyond mere profit calculations, beyond just numbers and gains. It is an economic order built on the foundation of faith and divine values, a system that prioritizes human well-being over all forms of exploitation. In a world increasingly thirsty for balance and justice, Islamic economics offers a comprehensive solution: not only worldly prosperity but also blessings leading to the afterlife.
Imagine an economic system that does not enrich only a few but provides opportunities for everyone to have an equal chance. A system that encourages hard work, rejects harmful uncertainties, and dares to oppose interest and exploitative practices. In Islamic economics, there are noble values such as social justice, responsible ownership, and harmony between individual rights and the common good.
By emphasizing key concepts such as monotheism, justice, prohibition of interest, and balance between private ownership and social interests, Islamic economics not only manages wealth but also creates harmony for life. Here, life’s goal is not solely wealth, but blessings and accountability to the Almighty.
Here is a detailed and systematic discussion of the main characteristics of Islamic economics:
- Foundation of Tawhid (Belief in Allah)
Islamic economics is entirely based on faith in Allah, that is, the belief that Allah is the Creator and Owner of everything. In this system, humans are merely caliphs or stewards on earth, tasked with managing resources responsibly and in accordance with His guidance.
Economic activities are not merely processes of obtaining material gains but are acts of worship that must comply with Allah’s rules. This concept provides a framework where economic activities should be free from actions that contradict Islamic teachings, such as interest (riba), uncertainty (gharar), and gambling (maysir).
Related Verse: “Say, ‘Indeed, my prayer, my rites of sacrifice, my living and my dying are for Allah, Lord of the worlds.'” (Quran, Surah Al-An’am: 162)
- Social Justice (Al-‘Adalah)
Islam emphasizes justice in the distribution of wealth. Islamic economics believes that every individual has the right to wealth obtained through lawful means, but also has the obligation to share through zakat, charity, and endowments. This prevents extreme economic disparity, which is often seen in capitalist and socialist systems.
Social justice in Islamic economics also includes fair labor rights, fair pricing for consumers, and equal economic opportunities. A just society is a primary goal in Islamic economic structure, fostering social harmony and reducing conflict.
Related Verse: “Indeed, Allah commands justice, good conduct, and giving to relatives.” (Quran, Surah An-Nahl: 90)
- Prohibition of Riba and Emphasis on Profit-Sharing Systems
One of the main characteristics of Islamic economics is the prohibition of riba (interest). Riba is seen as a harmful and exploitative practice, which can lead to social injustice, economic inequality, and oppression of the less fortunate.
As an alternative, Islam introduces profit-sharing systems such as mudharabah (business partnership between capital owner and manager) and musharakah (joint capital partnership), which are fairer. In profit-sharing systems, both profits and losses are shared according to each party’s contribution, promoting fair and balanced cooperation.
Related Verse: “Allah has permitted trade and has forbidden interest.” (Quran, Surah Al-Baqarah: 275)
- Balance between Private Ownership and Public Interest
Islamic economics recognizes the right to private ownership but with the condition that such ownership should not harm public interest. Individuals have the right to their wealth, but Islam directs that wealth should not be used for harmful purposes or for exploitation.
When urgent social needs arise, the state or society has the right to intervene in private ownership, for instance, in situations requiring land for public facilities or emergencies. Thus, Islam prioritizes a balance between individual rights and public interest.
Related Hadith: “Each of you is a shepherd and is responsible for his flock.” (Narrated by Bukhari and Muslim)
- Ensuring Public Welfare (Maslahah)
Islamic economics aims to achieve public welfare, meaning the well-being of humanity in a broad sense. This concept is integrated into the objectives of maqasid al-shariah, which safeguard five main aspects of human life: religion, life, intellect, lineage, and wealth. All economic activities should ensure that none of these aspects are harmed.
For instance, businesses in Islam should not produce or trade goods that can harm life or intellect, such as alcohol, drugs, and other prohibited items. Similarly, society is encouraged to cooperate in activities that bring public benefits and avoid harmful actions.
Related Verse: “And cooperate in righteousness and piety, but do not cooperate in sin and aggression.” (Quran, Surah Al-Ma’idah: 2)
- Prohibition of Speculation (Maysir) and Fraud (Gharar)
Speculation (maysir) and uncertainty (gharar) in economic transactions are strongly prohibited in Islam. An example of maysir is gambling, where profit is gained without a clear basis and can unfairly harm the other party. Gharar, on the other hand, occurs in transactions that lack clarity regarding rights, obligations, price, or the goods themselves, such as in non-transparent trade or selling items that do not exist.
This prohibition aims to prevent losses and unfairness for any party involved in a transaction. Islam encourages transparency in all business aspects, from pricing and product quality to payment methods.
Related verse: “O you who have believed, indeed, intoxicants, gambling, [sacrificing on] stone alters to other than Allah, and divining arrows are but defilement from the work of Satan.” (QS. Al-Ma’idah: 90).
- Blessing and Spiritual Purpose
Islamic economics prioritizes not only worldly gain but also blessings and the pleasure of Allah. Every wealth acquired must come from a lawful source and be spent in the right way. Blessings are considered a highly important value in Islam, as blessings make lawful wealth, even if little, feel sufficient, in contrast to abundant wealth without blessings.
Economic activities in Islam aim for both worldly and afterlife welfare. Islam encourages Muslims to always ensure the lawfulness of their wealth sources and expenditures to attain life’s blessings.
Related verse: “And whoever fears Allah – He will make for him a way out and will provide for him from where he does not expect.” (QS. At-Talaq: 2-3).
- Balance between World and Afterlife
The Islamic economic system emphasizes that worldly life cannot be separated from afterlife interests. Every economic activity must not only be materially beneficial but also hold spiritual value, providing benefits in this life and rewards in the afterlife.
This means a Muslim must be responsible in each economic endeavor and consider its impact on their afterlife. Economic activities carried out with the right intention contribute to social welfare and offer spiritual benefits.
Related verse: “But seek, through that which Allah has given you, the home of the Hereafter; and [yet], do not forget your share of the world.” (QS. Al-Qashash: 77).
- Respect for Hard Work and Productivity
Islam teaches its followers to work hard, professionally, and productively, as earning lawfully is an act of worship. Appreciation is given to those who strive lawfully, and hard work is considered a form of gratitude to Allah.
This shapes a work culture oriented toward quality and perseverance in Islam, where every lawful productive effort is valued, and individuals do not rely on others without self-effort.
Related Hadith: “No one has ever eaten better food than what he has eaten from the work of his own hands.” (HR. Bukhari).
Conclusion
Through these characteristics, Islamic economics offers an economic system that promotes not only material welfare but also spiritual, social, and moral wellbeing. These characteristics direct individuals to take responsibility for the welfare of the community and their surroundings, making Islamic economics a holistic and humane system.
By understanding the characteristics of Islamic economics, we see a system that provides not only economic solutions but also moral and spiritual guidance, shaping people as responsible economic actors. Islamic economics is not merely an alternative; it is a path toward true balance—upholding justice, shared prosperity, and blessings in every transaction and endeavor. In a world constantly evolving with new challenges, Islamic economics shines as a beacon showing how we can achieve welfare, not only for ourselves but for all humanity. May this concept not just remain in theory but become a spirit in realizing a blessed and peaceful civilization.
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