The Islamic economy

Islamic economics, and Islamic financial economics as part of it, is a child of the Islamic reform movement that started in the later part of the nineteenth century. Islamic economics is first and foremost normative economics. There have also been calls to develop a distinct Islamic theoretical system of economics, with its own epistemology. The principles underlying the Islamic norms and the idea of a distinct Islamic economic science are discussed first. This is followed by a review of the Islamic rules and norms that shape the Islamic economy. One of these norms, the prohibition of riba, had close parallels in Christianity and Judaism and still has echoes in Western secular society. These parallels are also briefly described. Next is a section on the Islamic economic order and after that a survey of Islamic criticisms of the prevailing Islamic financial institutions, including the solutions proposed by the critics.