Islamic Political Capitalism and Economics of Predation

Mehrdad Vahabi

Chapter 8 in Destructive Coordination, Anfal and Islamic Political Capitalism, 2023, pp 309-374 from Springer

Abstract: Abstract In this chapter, the Islamic political capitalism will be summed up as an economic system based on three fundamental institutions: (1) Velayat faqih (the jurisconsult of the vicegerent), (2) Anfal, and (3) destructive coordination. These institutions determine (4) the typical behavioral regularity of economic agents, namely capital and labor flight, and (5) a chronic hoarding economy as normal state of the system. The interplay between ‘mode of coordination’ and ‘mode of production’ will be ascertained in this chapter by questioning the impact of state predation on production. I will show that constant grabbing without any positive impact on productive capacity will lead to de-accumulation and shapes a specific type of development that I will coin patrimonial. It will be shown that Islamic political capitalism is the source of ecological disasters in Iran. An important conclusion can be derived from this chapter that is developed in epilogue: the non-reformability of the system which is closely related to its inner coherence. Reforms do not remove the fundamental problems of the system regarding capital investment, economic growth, and increase in productivity. The improvement of dynamic economic efficiency requires an institutional revolution putting an end to Velayat faqih, Anfal, and parallel institutions.

Date: 2023
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DOI: 10.1007/978-3-031-17674-6_8

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