Classical Muslim commerce History of Islamic economics

1 classical muslim commerce

1.1 economy in caliphate
1.2 trade
1.3 agriculture in medieval islamic world
1.4 islamic capitalism
1.5 islamic socialism
1.6 industrial development
1.7 labour force
1.8 urbanization

classical muslim commerce

the concepts of welfare , pension introduced in islamic law forms of zakat (charity), 1 of 5 pillars of islam, since time of abbasid caliph al-mansur in 8th century. taxes (including zakat , jizya) collected in treasury of islamic government used provide income needy, including poor, elderly, orphans, widows, , disabled. according islamic jurist al-ghazali (algazel, 1058–1111), government expected store food supplies in every region in case disaster or famine occurs. caliphate 1 of earliest welfare states, particularly abbasid caliphate.

economy in caliphate

in medieval arab agricultural revolution, social transformation took place result of changing land ownership giving individuals of gender, right buy, sell, mortgage , inherit land.

early forms of proto-capitalism , free markets present in caliphate. market economy , form of merchant capitalism developed between 8th , 12th centuries. vigorous monetary economy developed based on wide circulation of common currency (the dinar) , integration of independent monetary areas. business techniques , forms of business organization employed during time included contracts, bills of exchange, long-distance international trade, forms of partnership (mufawada) such limited partnerships (mudaraba), , forms of credit, debt, profit, loss, capital (al-mal), capital accumulation (nama al-mal), circulating capital, capital expenditure, revenue, cheques, promissory notes, trusts (waqf), savings accounts, transactional accounts, pawning, loaning, exchange rates, bankers, money changers, ledgers, deposits, assignments, double-entry bookkeeping system, , lawsuits. organizational enterprises similar corporations independent state existed in medieval islamic world. many of these concepts adopted , further advanced in medieval europe 13th century onwards.

the concepts of welfare , pension present in islamic law forms of zakat 1 of 5 pillars of islam, since time of rashidun caliph umar in 7th century. taxes (including zakat , jizya) collected in treasury (bayt al-mal) of islamic government used provide income needy, including poor, elderly, orphans, widows, , disabled. according islamic jurist al-ghazali (algazel, 1058–1111), government expected stockpile food supplies in every region in case of disaster or famine. caliphate 1 of earliest welfare states.

trade

during islamic golden age, isolated regions had contact far-reaching muslim trade network extending atlantic ocean , mediterranean in west indian ocean , south china sea in east, , covering of old world, including significant areas of asia , africa , of europe, trade networks . arabic silver dirham coins being circulated throughout afro-eurasian landmass, far sub-saharan africa in south , northern europe in north, in exchange goods , slaves.

this helped establish islamic empire (including rashidun, umayyad, abbasid , fatimid caliphates) world s leading extensive economic power in 7th-13th centuries.

due religious sanctions against debt, tamil muslims have historically been money changers (not money lenders) throughout south , south east asia.

agriculture in medieval islamic world

from 8th century 13th century in muslim lands many crops , plants planted along muslim trade routes, farming techniques spread. in addition changes in economy, population distribution, vegetation cover, agricultural production, population levels, urban growth, distribution of labour force, , numerous other aspects of life in islamic world affected according andrew watson. disputed other scholars, claim cultivation , consumption of staples such durum wheat, asiatic rice, , sorghum cotton commonplace centuries before, or agricultural production declined in areas brought under muslim rule in middle ages.

the demographics of medieval islamic society varied in significant aspects other agricultural societies, including decline in birth rates change in life expectancy. other traditional agrarian societies estimated have had average life expectancy of 20 25 years, while ancient rome , medieval europe estimated @ 20 30 years. conrad i. lawrence estimates average lifespan in islamic caliphate above 35 years general population, , several studies on lifespans of islamic scholars concluded members of occupational group enjoyed life expectancy between 69 , 75 years, though longevity not representative of general population.

the islamic empire had highest literacy rates among pre-modern societies, alongside city of classical athens in 4th century bc, , later, china after introduction of printing 10th century. 1 factor relatively high literacy rates in islamic empire parent-driven educational marketplace, state did not systematically subsidize educational services until introduction of state funding under nizam al-mulk in 11th century. factor diffusion of paper china, led efflorescence of books , written culture in islamic society, papermaking technology transformed islamic society (and later, rest of afro-eurasia) oral scribal culture, comparable later shifts scribal typographic culture, , typographic culture internet. other factors include widespread use of paper books in islamic society (more other existing society), study , memorization of qur an, flourishing commercial activity, , emergence of maktab , madrasah educational institutions.

islamic capitalism

early islamic commerce applied number of concepts , techniques, including bills of exchange, forms of partnership (mufawada) such limited partnerships (mudaraba), , forms of capital (al-mal), capital accumulation (nama al-mal), cheques, promissory notes, trusts (see waqf), transactional accounts, loans, ledgers , assignments. organizational enterprises independent of state existed in medieval islamic world, while agency institution introduced. medieval europe adopted , developed many of these concepts 13th century onwards.

the capitalists (sahib al-mal) stood @ height of power between 9th , 12th centuries, influence declined after arrival of ikta (landowners) , after state monopolized production; both these trends hampered development of industrial capitalism in islamic world. state enterprises still had capitalist mode of production, such pearl diving in iraq , textile industry in egypt.

from 11th 13th centuries, karimis , enterprise , business group controlled entrepreneurs, came dominate of islamic world s economy. group controlled fifty muslim merchants labelled karimis , of yemeni, egyptian , indian origin. each karimi merchant had considerable wealth, ranging @ least 100,000 dinars as 10 million dinars. group had considerable influence in important eastern markets, , influenced politics through financing activities , through variety of customers, including emirs, sultans, viziers, foreign merchants, , common consumers. karimis dominated many of trade routes across mediterranean, red sea, , indian ocean, , far francia in north, china in east, , sub-saharan africa in south, obtained gold gold mines. practices employed karimis included use of agents, financing of projects method of acquiring capital, , banking institution loans , deposits.

islamic socialism

though medieval islamic economics appears have resembled form of capitalism, arguing laid foundations development of modern capitalism, others see islamic economics neither capitalistic nor socialistic, rather balance between two, emphasizing both individual economic freedom , need serve common good.

abū dharr al-ghifārī, companion of muḥammad, credited many founder of islamic socialism.

the concepts of welfare , pension introduced in islamic law forms of zakat (charity), 1 of 5 pillars of islam, during time of rashidun caliph umar in 7th century. practiced continued era of abbasid caliphate, seen under al-ma mun s rule in 8th century, example. taxes (including zakat , jizya) collected in treasury of islamic government used provide income needy, including poor, elderly, orphans, widows, , disabled. according islamic jurist al-ghazali (algazel, 1058–1111), government expected stockpile food supplies in every region in case disaster or famine occurred. caliphate considered world s first major welfare state.

industrial development

a variety of industrial mills used in islamic world, including fulling mills, gristmills, hullers, sawmills, shipmills, stamp mills, steel mills, sugar mills, tide mills, , windmills. 11th century, every province throughout islamic world had these industrial mills in operation, al-andalus , north africa middle east , central asia. muslim engineers employed water turbines, , gears in mills , water-raising machines, , pioneered use of dams source of water power, used provide additional power watermills , water-raising machines. such advances made possible many industrial tasks driven manual labour in ancient times mechanized , driven machinery instead in medieval islamic world.

in addition government-owned tiraz textile factories, there privately owned enterprises run largely landlords collected taxes , invested them in textile industry.

labour force

the labor force in caliphate employed diverse ethnic , religious backgrounds, while both men , women involved in diverse occupations , economic activities. women employed in wide range of commercial activities , diverse occupations in primary sector (as farmers example), secondary sector (as construction workers, dyers, spinners, etc.) , tertiary sector (as investors, doctors, nurses, presidents of guilds, brokers, peddlers, lenders, scholars, etc.). muslim women held monopoly on branches of textile industry, largest , specialized , market-oriented industry @ time, in occupations such spinning, dyeing, , embroidery. in comparison, female property rights , wage labour relatively uncommon in europe until industrial revolution in 18th , 19th centuries.

the division of labour diverse , had been evolving on centuries. during 8th–11th centuries, there on average 63 unique occupations in primary sector of economic activity (extractive), 697 unique occupations in secondary sector (manufacturing), , 736 unique occupations in tertiary sector (service). 12th century, number of unique occupations in primary sector , secondary sector decreased 35 , 679 respectively, while number of unique occupations in tertiary sector increased 1,175. these changes in division of labour reflect increased mechanization , use of machinery replace manual labour , increased standard of living , quality of life of citizens in caliphate.

an economic transition occurred during period, due diversity of service sector being far greater other previous or contemporary society, , high degree of economic integration between labour force , economy. islamic society experienced change in attitude towards manual labour. in islamic world, manual labour seen in positive light, intellectuals such brethren of purity likened them participant in act of creation, while ibn khaldun alluded benefits of manual labour progress of society.

by 10th century, idea of academic degree introduced , being granted @ maktab schools, madrasah colleges , bimaristan hospitals. in medical field in particular, ijazah certificate granted qualified practicing physicians, in order differentiate them unqualified quacks.

urbanization

there significant increase in urbanization during period. resulted in rising middle class population.

the head of family given position of authority in household, although qadi, or judge able negotiate , resolve differences in issues of disagreements within families , between them. 2 senior representatives of municipal authority qadi , muhtasib, held responsibilities of many issues, including quality of water, maintenance of city streets, containing outbreaks of disease, supervising markets, , prompt burial of dead.

taxes levied on unmarried man until wed. instead of zakat, mandatory charity required of muslims, non-muslims required pay jizya, discriminatory religious tax, imposed on christians , jews. during muslim conquests of 7th , 8th centuries conquered populations given 3 choices of either converting islam, paying jizya, or dying sword.