Bringing Substantive Morality Back in: Towards a Definition of Islamic Moral Economy

As part of the objective of reconstructing an authentic Muslim identity and negotiating (or rather coopting) with the modern nation state building, in the post-colonial period, Muslim scholarship fundamentally aimed at establishing a distinct economic system, which derives its theoretical base from the ontological sources of Islam in order to enhance human wellbeing and social welfare through circumventing socioeconomic challenges of Muslims in concomitance with the rise of modernist impositions on everyday life practices. In this respect, the idea of Islamic economics has been theorized in reactive and reflexive manners, due to the immediate need for finding sound alternatives to (post) modern hegemonic discourse and cultural domination.

At its state of art, far from being authentic and distinct, Islamic economics has accompanied its peculiar centricity and rationality amongst Muslim scholarship in order to respond Eurocentrism and universal rationality assumptions imposed by the Western worldview. Despite its pioneering role in constructing an Islamic economic system, Islamic economics seems unable to avoid (i) from the modernist notion of convergence -towards claiming its universality and rejecting dissimilarities in theory making, and, with certain degree, (ii) from the postmodern adoption of divergence, which proposes deconstruction of any sort of centrism (decentering) and universal truth, between economy and finance (i.e. financialization of Islamic economics through essentializing financial and banking sector). Additionally, as the notion of ‘economics’ is socially constructed though Western type economic modeling, it is also subject to question as to which extent Islamic ‘economics’ would claim to be authentic by insisting on the use of ‘economics’. In other words, the term ‘economics’ is already a neoclassical construct that has been subjected to serious backlashes by Islamic scholars, concatenating ‘Islam’ and ‘economics’ -as ‘Islamic economics’ suggests- produces a conceptual inconsistency with Islamic teachings since Islamic economic model with such frame would seem one of the variants of Western economics.

Mainly owing to these factors, Islamic economics was unable to go beyond ‘instrumental morality’, and hence failed to accommodate ‘substantive morality’ at the core of its theorization. However, substantive morality would ideally be constituted as the essential pillar, for Islam suggests morally driven economic behavior and system in which norms and values are embedded and function as social laws as contrast to iron economic laws of mainstream economics.

In responding to the expectations, Islamic moral economy (IME) aims to locate substantive morality into its economic theorizing through constituting the substance of Islamic political economy, functioning under Islamic social formation as a framework. In doing so, IME as a particular system encompassing all other systems inside the Islamic order through providing ethicoeconomic relationship suggests an axiomatic approach in articulating norms and values derived from Islamic ontology so that morality would be substantiated in the political economy framework. Among the axioms, tawhid (complementarity and unitarity), rububiyyah (nourishment, sustenance and directing things towards their perfection), khilafah (vicegerency), al-adl wa’l-ihsan (justice and beneficence) and tazkiyah (purification plus growth) play a critical role to ensure substantive morality integrated economy order.

The primary concern of IME is to achieve individual falah (salvation) in this world and in the hereafter, however, the ultimate objective is to go beyond individual falah and establish ihsan (beneficence) as a social capital at societal level so that social good can be achieved.

These notions are quite reminiscent of the concepts of self-interest and virtues of interdependence that Adam Smith reiterates in his theory making; however differently, Smith, being a moral philosopher, ended up with economics as a science in which moral considerations related to economic institutions are negated in the market mechanism through ‘invisible hand’. As, in reality, this mechanism could have never substantiated morality, ‘economics science’ has always claimed to be a value free science that neglects any sort of moral concern in its agenda. Thus, market economies, in this manner, cannot be considered as ethical economies, since the ethical base is completely taken out from the economic system and considered as an exogenous factor, which individuals might voluntarily involve in. However, it should be acknowledged that pre-capitalist societies were displaying the characteristics of moral economies, for there was no self-regulated market paradigm, in which non-economic factors, such as norms, values and beliefs of the society, are considered as main determinants of economic and financial choices implying an embedded economic decision making process. Therefore, in a Polanyian sense, the main objective of IME would be to produce a particular social formation in which land, labor and money are rescued from the market economy rules and hence from commodification, and to suggest a counter movement towards re-embedding economy into social relations and institutions.

The crosschecking system in Islamic moral economy is, on the other hand, built on four procedural blocks without which moral considerations remains instrumental. Intentionalism, contemplation, action and consequentialism constitute these blocks respectively in such a way that the ‘becoming process towards homoIslamicus individual’ is examined and rectified accordingly in every step of this procedure whereby Islamic substantive morality is produced. This suggests that through this institutional forms of Islamic economics, the mimicry adopted by Islamic finance can be overcome and authenticity can be achieved, since form-based interpretation and evaluation of the practices of Islamic finance cannot go beyond intentionalist limits and fails when consequentialist checking is applied.

This study, correspondingly, aims to explore general flaws of the theorization of Islamic economics by introducing modernist and post modernist inclinations of it and, in suggesting an alternative reading of the economic understanding of Islam, it essentializes Islamic moral economy as a distinct economic model which locates substantive morality at the core of its theorization within a systemic understanding by also essentializing consequentialist morality. In this respect, this study proposes an authentic definition and identification of Islamic moral economy by identifying its paradigmatic framework of political economy, value system, axiomatic approach and operational principles. The conceptual development, presented in this study, should be considered an original attempt as it aims to fill a particular gap in the knowledge map of Islamic economic theorizing.