Islamic Commercial Law

Essay

May 24, 2012

2008 words

Islamic commercial law

Introduction

The religion Islam has rejected all unlawful means of gaining money and resources and considers it a sinful act. On the other hand, it has laid down certain guidelines and principles that will help individuals in seeking money and profits through legal ways. The Islamic commercial law covers all the aspects of human life. The Islamic law also emphasizes on the approach that business transactions and dealings should be based on justice, equality and fairness. The Islamic commercial law has prohibited the use of Riba, insurance contracts and all the business which involves uncertainty.

Discussion

Question 4

Concept of capitalism

Capitalism is a term of the modern economic system, which is based on the concept of private ownership. In capitalism, individuals and organizations produce goods and services to earn profit and income and to generate revenue. Many scholars also relate the concept of capitalism for the competitive markets, labor wages and personal finance. Capitalism is basically the ownership of natural resources and goods or services. The owners of these resources are called capitalist, either individually or collectively. These owners operate in order to earn profit and generate revenue.Islamic economic principles

The concept of Islamic principles is derived from the religious worldwide views that also hit the value neutrality. The Islamic economic principles have laid down certain guidelines that promote and guarantee the true welfare of humans regardless of their age, sex or religion. The Islamic economic principles distinguish the role of market in the distribution of resources and also maintain the social interest of humans. The Islamic economic principles promotes human brotherhood, the welfare of all people in the society and also enables socio economic justice through an incorporated responsibility of ethical values, good governance and perfect market mechanism.

Difference between capitalism and Islamic economic principles

Capitalism is based on the concept that markets exits to satisfy the needs of the people living in the society. The capitalist system separates the church and the affairs of the sate from the affairs of life. Capitalist approach basically is based on the concept of freedom. Freedom plays a significant role in the ideology of capitalist. The theory states that freedom is guaranteed by the state and every human has the right to satisfy its need.

On the other hand, the Islamic economic system states that there is a single source that can satisfy the needs and demands of everyone, without resulting in chaos. The only source is the creator of the world. Islam does not neglect the needs and demands of humans, but it has laid down certain guidelines that should be adopted to satisfy our demands and needs.

Capitalism also supports and encourages the theory of relative scarcity. This means that there will always be insufficient forces of goods and commodities that meet the needs of people. There are various goods and services available that satisfy the needs of humans, but this contradicts the principle of relative scarcity. This happens because; there are many people, who are unable to meet their basic need ...