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Consumprion and Islam: Micro Foundations and Macro Modelling

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  • Zubair HASAN

    (INCEIF, Malaysia.)

Abstract

Function in Islamic economics. It starts with a brief look at the microelements of the concept and clears several cobwebs concerning wants and needs, scarcity of resources, the basket of goods, and the efficacy of utility and its maximization for consumer equilibrium. The explanations narrow down the conceptual gaps between the micro and macro level articulations of the subject. Next, the paper reviews some selected macro models resting on division of income on the basis of nisab between the upper (rich) and the lower (poor) classes of society for analyzing the impact of zakah-moderation mechanism on economic growth via the saving-investment route. It is demonstrated that, contrary to the claim based on models, the positive impact of Islamic scheme on the variables studied is uncertain, to put it mildly. Finally, attention is drawn to some recent developments in the treatment of consumption in economics as also to interest being shown in the subject in other social sciences. This inter-disciplinary approach seeks to detach consumption from income and links it to wealth. It also brings in environmental and ethical concerns into the picture. The effort promises to bring the treatment of consumption closer in the two economic disciplines, secular and Islamic: it is a welcome development.

Suggested Citation

  • Zubair HASAN, 2017. "Consumprion and Islam: Micro Foundations and Macro Modelling," Journal of Economic and Social Thought, KSP Journals, vol. 4(1), pages 108-118, March.
    • Handle: RePEc:ksp:journ3:v:4:y:2017:i:1:p:108-118
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    References listed on IDEAS

    as
    1. Hasan, Zubair, 1996. "Book Review: “An Introduction to Islamic Economics” by Akram Khan," MPRA Paper 2980, University Library of Munich, Germany.
    2. Hasan, Zubair, 1985. "Macro Consumption Function in an Islamic Framework by Fahim Khan: Comments," MPRA Paper 3185, University Library of Munich, Germany.
    3. Zubair Hasan, 1985. "M. Fahim Khan: Macro Consumption Function in an Islamic Framework, Comments: Zubair Hasan محمد فهيم خان: وظيفة الاستهلاك الكلي في إطار إسلامي - تعليق: زبير حسن," Journal of Research in Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 2(2), pages 71-73, July.
    4. Hasan, Zubair, 2002. "Maximisation postulates and their efficacy for Islamic economics," MPRA Paper 3006, University Library of Munich, Germany.
    5. Zubair Hasan, 1990. "Munawar Iqbal: Zakah, Moderation and Aggregate Consumption in an Islamic Economy, Comment منور إقبال: الزكاة والاعتدال والاستهلاك الكلي في الاقتصاد الإسلامي - تعليق," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 2(1), pages 91-100, January.
    6. Hasan, Zubair, 1990. "Zakah, Moderation, and Aggregate Consumption by Munawar Iqbal: Comments," MPRA Paper 3224, University Library of Munich, Germany.
    7. Munawar Iqbal, 1985. "Zakah, Moderation and Aggregate Consumption in An Islamic Economy الزكاة، والاعتدال في الإنفاق، والاستهلاك الكلي في اقتصاد إسلامي," Journal of Research in Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 3(1), pages 45-61, January.
    8. Slesnick,Daniel T., 2001. "Consumption and Social Welfare," Cambridge Books, Cambridge University Press, number 9780521497206, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Wants and needs; Micro foundations; Utility maximization; Macro models; Scarcity.;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment

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