Between Free Market and State Capitalism: How Islamic Economics System Shape the Future Global Economy?

Abdul Ghafar Ismail ()

No 1435-8, Working Papers from The Islamic Research and Teaching Institute (IRTI)

Abstract: Free market economy is proposed to deliver on the promises of improving the standards of living of most citizens. However, the economic crisis that happen repeatedly failed to produce what was promised. Then, state capitalism has to step in. The state capitalism also fails in the sense that the free market economy with rules/policy in favour of rich countries or state capitalism provide more people worst-off than benefits. The question arises on how the Islamic economic system could shape the free markets and the future of the global economy. Therefore, our aim in this paper is to find out the answer(s) on how Islamic economics system shape the future global economy could. Our analysis shows that Islam has its own economic system. The free market could be developed by taking the free market of Rasulullah (saw) and free market in holding wealth. The government policy directed towards no interest and creating a welfare system is welcome.

Keywords: free market; state capitalism; economic thought; economic system (search for similar items in EconPapers)
JEL-codes: B11 D47 P10 P40 Z12 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2014-01-19
New Economics Papers: this item is included in nep-hme and nep-hpe
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