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Capitalism in Medieval Islam

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  • Labib, Subhi Y.

Abstract

He who looks for the term “capitalism” in the Islamic sources of the Middle Ages will look in vain. On the other hand, the term “capital” has been known since the beginning of Islamic culture. Even in the Holy Book of Islam, in the Sūrat al-Baḳara, the idea of capital appears in connection with trade, business, and the illicit practice of loaning for profit—usury. “O you who believe, keep your duty to Allah and relinquish what remains [due] from usury, if you are believers. But if you do [it] not, then be apprised of war from Allah and His messenger; and if you repent, then you shall have your capital. Wrong not, and you shall not be wronged.” In the same Sūrah God forbids usury but not Bai', trading, or buying. At another place God's commands clear the way for investments. “O you who believe, devour not your property among yourselves by illegal methods, although you may engage in trading by mutual consent. And kill not your people. Surely Allah is merciful to you.”The Islamic merchant tried to follow this system of ethics.

Suggested Citation

  • Labib, Subhi Y., 1969. "Capitalism in Medieval Islam," The Journal of Economic History, Cambridge University Press, vol. 29(1), pages 79-96, March.
    • Handle: RePEc:cup:jechis:v:29:y:1969:i:01:p:79-96_09
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    Cited by:

    1. Mirakhor, Abbas, 2007. "Islamic Finance and Globalization: A Convergence?," MPRA Paper 56026, University Library of Munich, Germany.
    2. Michalopoulos, Stelios & Naghavi, Alireza & Prarolo, Giovanni, 2010. "Trade and Geography in the Economic Origins of Islam: Theory and Evidence," MPRA Paper 23136, University Library of Munich, Germany.
    3. Shakir Ullah & Ian A. Harwood & Dima Jamali, 2018. "‘Fatwa Repositioning’: The Hidden Struggle for Shari’a Compliance Within Islamic Financial Institutions," Journal of Business Ethics, Springer, vol. 149(4), pages 895-917, June.
    4. Nabi, Mahmoud Sami & Abdelkafi, Rami & Drine, Imed & Al-Suwailem, Sami, 2015. "Enhancing Intra-Trade in OIC Member Countries Through T-SDRs," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 23, pages 101-124.
    5. Schramm, Matthias & Taube, Markus, 2003. "Evolution and institutional foundation of the hawala financial system," International Review of Financial Analysis, Elsevier, vol. 12(4), pages 405-420.
    6. Murat Çizakça, 2014. "The economic role of the state in Islam," Chapters, in: M. Kabir Hassan & Mervyn K. Lewis (ed.), Handbook on Islam and Economic Life, chapter 25, pages iii-iii, Edward Elgar Publishing.
    7. James L. Barbour, 2008. "A Different Song: Schneider’s ‘Singede Steine’ as evidence of work practices in the late 12th century," Working Papers 2008-05, Elon University, Department of Economics.
    8. Rubin, Jared, 2010. "Bills of exchange, interest bans, and impersonal exchange in Islam and Christianity," Explorations in Economic History, Elsevier, vol. 47(2), pages 213-227, April.
    9. van Bavel, Bas, 2016. "The Invisible Hand?: How Market Economies have Emerged and Declined Since AD 500," OUP Catalogue, Oxford University Press, number 9780199608133.

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