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Scott J. Flower
University of Melbourne
Email: scott.flower@unimelb.edu.au
doi:10.1093/jis/etu031
Published online 24 March 2014

Maqasid Foundations of Market Economics

By Seif Ibrahim Tag el-Din (Edinburgh: Edinburgh University
Press, 2013), viii 240 pp., glossary, bibliography, index. Price PB
24.99. EAN 9780748670031.
This book is the outcome of the authors long teaching experience in the MA
programme at the Leicester-based Markfield Institute of Higher Education
(MIHE), a programme subsequently accredited by Portsmouth University, the
University of Loughborough and the University of Gloucestershire. The book
provides interesting insights into market economics for markets operating
according to Shar;6a. Maqasid Foundations has three parts with eight chapters in
all, each part starting with a brief preview and ending with a bullet-form
summary and a range of self-test questions.
The book bridges the theory and practice of Islamic economics in the light of
maq:Bid al-Shar;6a, i.e., the objectives of Islamic law. Eminent Muslim scholars,
such as al-Ghaz:l;, Ibn Taymiyya, Ibn al-Qayyim, al-Sh:3ib;, and Ibn Ash<r,

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expect a reader to believe Muslims in these societies have no agency of their own
or no influence on their countrys governance and the West is solely to blame?
Chapter 7, Education and Sustainable Development is a strange final addition
to the book, and the reason for its incorporation is not made clear. The chapter
primarily discusses technical dimensions and benefits of an Islamic educational
philosophy instead of dealing with how such a philosophy might translate to
improving sustainability. The book ends in a curious and somewhat unorthodox
manner in an Epilogue conversation rather than the usual structured approach
concluding a book of this nature.
Despite the books deficiencies as an academic and empirical work it is still
worth reading for those interested in sustainability and in what Islams potential
philosophical and theoretical contributions might be to one of the worlds
greatest social, environmental and political challenges. Written in a clear jargonfree manner, the book has few contemporary rivals that are as comprehensive a
source of information on the topic. It is also a good reminder to those working in
the sustainability industry that there are other perspectives, which differ
philosophically from the predominant Western view. The book will interest
policy-makers, development practitioners and banks in the Islamic world, as well
as those with professional interests in planning, environmental and conservation
issues.

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among many others, developed or critiqued the concept of maq:Bid to help make
the general ideals of Islam enforceable in the daily transactions of Muslim life.
The Islamic principles of market economics are presented through an elucidation
of why usury, uncertainty (gharar), inequity (ghaban), and monopoly are
prohibited. The author offers an excellent comparison between Islamic and
conventional economics, showing how widely they differ once those prohibitions
are taken into account. However, his discussion is not constrained by any
dependence on the salient differences between Islamic and conventional
economics. Rather, the comparative material serves to underpin a treatment
based on the religious foundations of the Shar;6a.
The first part, on methodology from the maq:Bid perspective, tries to answer
the central question of how the Shar;6a prioritizes the allocation of scarce
resources in order to achieve optimum social and economic well-being. In
answering this question, various issues are expounded, the most important of
which are the five Necessities of maq:Bid, namely religion, self, mind, progeny,
and wealth. As claimed by the author, the achievement of optimum social and
economic well-being culminates in a three-stage development model prioritizing
human wants and needs, justly and sequentially, from Necessities (@ar<r:t), to
Needs (A:jiyy:t), to Refinements (taAs;niyy:t). Pioneered by al-Sh:3ib; and alGhaz:l;, the five Necessities are considered the basic staples on which socioeconomic well-being rests. The focus of Islamic economics is to establish these
Necessities prior to looking to the Needs and Refinements. This prioritization is
the essence of the maq:Bid perspective on socio-economic well-being. Its
extension and expression in public policy entails an emphasis on fairness and
equity. Appropriate prioritization of Necessities favours equitable wealth
distribution along with ongoing efforts to eliminate absolute poverty and
alleviate relative poverty. The point of optimal Shar;6a-compliant financing is to
ensure an equitable public policy. The author maintains that there are two main
requirements, namely (1) the moral motive in terms of practical qualifications,
training and support, and (2) preventive rather than curative public expenditures.
The second part of the book addresses several interesting topics of which the
most salient are the sheer difference between lawful trade and forbidden usury,
the fundamental role of money as a medium of exchange, and the harmful
consequences to the economy and to the interdependence of economics of
interest-price money. From the maq:Bid perspective all types of rib: (usury) are
forbidden. The author provides an excellent description of these types and the
rationale behind their prohibition. The main types discussed are rib: al-buy<6,
rib: al-naB;8a, and rib: al-J:hiliyya. Although the main motive for avoiding
interest-bearing transactions is religious obedience, there are supplementary,
technical arguments that show how harmful rib: is. Also, the author demonstrates the appeal of interest-free lending (qar@ Aasan), at least from a theoretical
perspective. He develops a qar@ Aasan line and shows that the qar@ Aasan is an
optimal-Pareto equilibrium. The standard Fishers model fails to recognize it as a
Pareto-optimal solution since it is considered irrelevant to the practice of

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Walid Mansour
Islamic Economics Institute, King Abdulaziz University
E-mail: wmmansour@kau.edu.sa
doi:10.1093/jis/etu050
Published online 20 June 2014

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financial markets. In addition, the qar@ Aasan line demonstrates the potential of
interest-free transactions to sustain productive optimality, while the positive
interest line lowers productive optimality.
Islamic economics has something to contribute on the issue of market
imperfections, one central to modern economics. Starting from the mid-1970s,
this issue (particularly in respect to information asymmetry) has been of
increasing interest to both academics and practitioners. It is taken up in the third
part of the book. The interplay between the conventional economic and Shar;6a
rationales shows that it is not only the derivations from a healthy economic order
provoked by monopoly power that is considered a failure. No less important are
the effects of information asymmetries and uncertainty-driven games. Indeed,
market imperfections constitute a nonconformity to the standard conjectures in
economics, such as homogenous goods, free entry/exit to the match, information
symmetry, and zero transaction costs. The power of the monopolist (muAtakir)
constitutes an aberrance. The Prophet condemned the activities of the muAtakir
around 1430 years ago. It is quite a challenge now to state precisely the
distinctions between the power of the modern monopolies and the muAtakir and
under what conditions the perfect operation of the markets is infringed. The
author argues that corrective policy depends on how different regulatory systems
assess the gravity of market imperfections. Islamic jurisprudence has its own
approach to deal with the harmful impact of iAtik:r (monopoly). The maq:Bid
approach serves as a barrier against violations of the functioning of properly
competitive markets. Historically, the Aisba was the institution that governed and
supervised the proper functioning of markets in accordance with maq:Bid.
Modern institutionalization of the maq:Bid in the governance and regulation of
markets requires a priori measures such as prohibiting sales usury, maintaining
market competitiveness through the support of anti-gambling and anti-monopoly
measures, and protecting market participants against incentive-driven problems.
Such a priori measures are expected to enhance fairness in the markets, help
alleviate information asymmetries and substitute risk sharing for risk shifting.
Overall, this book is a welcome contribution to the theory of Islamic
economics and it will stimulate further theoretical investigations of the
conceptual and quantitative foundations of maq:Bid al-Shar;6a. It builds on the
sources of maq:Bid in order to show how well markets could work under Shar;6a.
Once rib: is banned and exploitative financial contracts are excluded or at least
marginalized, markets would indeed operate more efficiently. The challenge for
prospective readers of this book is to have sufficient grounding in both economics
and Shar;6a to understand the core arguments of the book and their implications.