Photo by seier+seier+seierI've found myself drawn again and again to discussions of Islamic finance in recent months. I'm reading a great paper now that lays the foundation for what I hope will be my better appreciation of its contribution and continuing role in the modern world. Timur Kuran was kind enough to share with us through SSRN his fascinating paper, The Scale of Entrepreneurship in Middle Eastern History: Inhibitive Roles of Islamic Institutions. This is not the short-sighted, xenophobic rant that one has come to expect of western commentary on Islamic institutions in the post-9/11 world (indeed, I apologize for revealing that the title gave me that impression). Instead, Prof. Kuran lays out a level-headed exploration of how and why Islamic law facilitated early entrepreneurialism, based as it was on personal, short-lived business arrangements, but it impeded modern entrepreneurialism after the transition to more impersonal, longer-term business arrangements. I'm not finished with the paper yet, but its central argument seems to be one I've seen before: the central role played by the corporate form in collecting and locking in long-term capital, catapulting European (and U.S.) commerce, was not available in Islamic law until much later, thus critically inhibiting growth.
We in the West obviously have much to learn about Islam and its role in facilitating and restricting business and commerce (the amount of money flowing through Islamic law-compliant banks and funds is impressive and growing). Prof. Kuran's paper helps novices like me to take a comfortable first step in the direction of better objective, non-judgmental understanding. Check it out!
1 comment:
Jason,
I'm heartened to learn of your interest in Islamic finance, and of course Timur Kuran is one of the leading lights on this topic. For the uninitiated, here are some titles that provide a manageable introduction to Islamic finance and Islamic economics in general (including economics in the Middle East, keeping in mind of course that most Muslims live outside the Middle East; the list received an imprimatur, so to speak, from Professor Haider A. Hamoudi, who has some excellent articles available at SSRN: http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=641155):
Chaudhry, Kiren Aziz. The Price of Wealth: Economies and Institutions in the Middle East. Ithaca, NY: Cornell University Press, 1997.
El-Gamal, Mahmoud A. Islamic Finance: Law, Economics, and Practice. Cambridge, UK: Cambridge University Press, 2006.
Henry, Clement H. and Robert Springborg. Globalization and the Politics of Development in the Middle East. Cambridge, UK: Cambridge University Press, 2001.
Issawi, Charles. An Economic History of the Middle East and North Africa. New York: Columbia University Press, 1982.
Kuran, Timur. Islam and Mammon: The Economic Predicaments of Islamism. Princeton, NJ: Princeton University Press, 2004.
Mallat, Chibli. The Renewal of Islamic Law: Muhammad Baqer as-Sadr, Najaf and the Shi’i International. Cambridge, UK: Cambridge University Press, 1993.
Mannan, M.A. Islamic Economics: Theory and Practice. Boulder, CO: Westview Press, 1987.
Richards, Alan and John Waterbury. A Political Economy of the Middle East. Boulder, CO: Westview Press, 2nd ed., 1996.
as-Sadr, Muhammad Bāqir (Roy Mottahedeh, trans.). Lessons in Islamic Jurisprudence. Oxford, UK: Oneworld, 2003.
Saeed, Abdullah. Islamic Banking and Interest: A Study of the Prohibition of Ribā and Its Contemporary Interpretation. Leiden: E.J. Brill, 2nd ed., 1997.
Saleh, Nabil. Unlawful Gain and Legitimate Profit in Islamic Law. London: Graham and Trotman, 2nd ed., 1992.
Tripp, Charles. Islam and the Moral Economy: The Challenge of Capitalism. Cambridge, UK: Cambridge University Press, 2006.
Warde, Ibrahim. Islamic Finance in the Global Economy. Edinburgh: Edinburgh University Press, 2000.
Several of these books have excellent bibliographies for further exploration of Islamic economics. Should anyone want to see related titles on Islamic law I will send a copy of my bibliography for "comparative law" which has a section on same of books in English.
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