Reconstruction of Islamic Economic Thought: Need for Innovative Thinking (Ijtihad)

Abstract

While claiming to develop Islamic economics as a social science based on the Qur’an and the hadith, Muslim scholars have actually ended up presenting ‘Islamic economic teachings’ in modern jargon. Although it is a valuable contribution, yet they did not adjust the meanings and interpretations of the primary texts in light of socio-economic developments that had taken place since the beginning of Islam. Besides presenting archaic interpretations of the Qur’an and the hadith, they relied heavily on the Islamic law (fiqh) without realizing the fact that the social context of the legal thought was outdated by several centuries. Human social and economic developments have evolved into new dimensions since then. New problems and challenges have emerged which require innovative thinking (ijtihad) and fresh interpretation of the primary sources. The paper gives examples of at least six priority areas where ijtihad is required. These areas are: shari’ah and maqasid al-shari’ah; definition of riba; zakah law; distribution of profit and loss under musharaka; Islamic commercial law; and implementation of the law of inheritance. The paper proposes a plan for creating necessary infrastructure for ijtihad.