Читать книгу The Future of Economics - M. Umer Chapra - Страница 8
ОглавлениеIs it Necessary to Have Economics with an Islamic Perspective?
Apart from the Islamic world where fundamentalist political tendencies are quite marked, the global political scene is dominated by rhetoric and values that are primarily consumption-oriented and that stress personal self-gratification as the primary purpose of political action.
(Zbigniew Brzezinsky)1
No science can be more secure than the unconscious metaphysics which it tacitly presupposes.
(Alfred North Whitehead)2
Conventional economics, which dominates modern economic thinking, is now a well-developed and sophisticated discipline having gone through a long and rigorous process of development lasting more than a century. The development continues uninterrupted, as reflected in the publication of innumerable journals, books, and research reports throughout the world. Individuals, universities, research organizations and governments are all actively participating in this development. Furthermore, substantial resources are available to scholars to pursue their research as a result of accelerated development in Western industrial countries. It is to the credit of the West that there is such a great quest for knowledge, that researchers are willing to work rigorously, and that creative work is richly rewarded in terms of both prestige and material benefit.
Economics with an Islamic perspective, which is now referred to as Islamic Economics, has, however, only enjoyed its resurgence over the last three to four decades and this after a deep slumber lasting several centuries. The number of individuals, universities, governments and research organizations participating in its development is, however, still relatively very small. Since most Muslim countries are poor and in the initial stages of development, the resources they have available at their disposal for financing research activities are also relatively meagre. Moreover, some of the governments in Muslim countries consider the resurgence of Islam, with its unmistakable call for political accountability and socio-economic justice, to be a threat to their survival. They are, therefore, reluctant to render any moral or material support for the development of the Islamic Social Sciences.
An unavoidable question, therefore, is whether it is really necessary to have Islamic Economics when conventional economics is already available in a highly developed form. This question acquires particular significance because the subject matter of both disciplines is nearly the same – the allocation and distribution of scarce resources among their infinite uses. The justification is there only if the effort to develop Islamic Economics is directed towards the realization of a purpose which cannot be achieved by the analysis developed by conventional economics. The need would be all the more acute if the set of variables employed for the analysis is broader, and the mechanisms and methods used for the allocation and distribution of resources are also different. An effort is made below to lay down a broad framework for analysis and to raise the questions that need to be answered in the following chapters.
Every activity of rational human beings generally has a purpose, and it is usually the purpose that determines its nature, differentiates it from other activities, and also helps evaluate its performance. The first question one may, therefore, wish to ask relates to the purpose behind any study of the allocation and distribution of resources. Such a study may not be necessary if resources were unlimited. However, resources are limited and are not sufficient to satisfy all the claims made on them by all individuals and groups in society. We are, therefore, posed with the perplexing question of which uses and whose claims to choose and how to make that choice. A simple answer, perhaps, may be to use them in such a way that helps society realize its vision. A vision essentially incorporates society’s dream about what it would like to be in the future. It may consist of a number of goals which the society aspires to achieve. All these goals together may serve as a guiding star and indicate the direction in which society wishes to proceed. This may help channel society’s efforts and energies in the desired direction and thereby minimize waste. The vision may, however, never be fully realized. It may, nevertheless, continue to inspire society to persist in the struggle for its realization by keeping the faith in the future perennially kindled.
Different societies may have different visions. Nevertheless, there is one dimension that seems to be common to most societies. This is the goal of realizing human well-being. However, the term well-being, even though used by a number of economists,3 is itself a controversial term and may be defined in a number of ways. It may be defined in a purely material sense, totally ignoring its spiritual content, or in a way that also takes into account the spiritual aspect. Depending on which definition of well-being one adopts, there may arise the need for an entirely different configuration of goods and services to be produced by society with the scarce resources at its disposal. This may lead to different mechanisms for allocation and distribution.
If well-being were defined in a purely material and hedonist sense, then it would be perfectly rational for economics to give prominence to the serving of self-interest and the maximization of wealth, bodily pleasures, and sensual gratifications. Since pleasures and sensual gratifications depend primarily on individual tastes and preferences, value judgements may have to be kept out so as to allow individuals total freedom to decide for themselves what they wish. In this way, all goods and services that provide such pleasures and gratifications to individuals in accordance with their own tastes and preferences may become acceptable. Impartial market forces may then be considered sufficient to bring about such an allocation and distribution of resources. Redistribution4 of the wealth produced may be important, but only to the extent to which it does not interfere with the freedom of the individual to pursue his or her self-interest. The government’s role may also have to be kept at a minimum, except insofar as it is necessary to enable the individual and the market to perform effectively.
However, if well-being were defined in such a way that rises above the materialist and hedonist sense and incorporates humanitarian and spiritual goals, then economics may not be able to avoid a discussion of what these goals are and how they may be realized. These goals may include not only economic well-being but also human brotherhood and socio-economic justice, sanctity of life, property and individual honour, mental peace and happiness, and family as well as social harmony. One of the tests for the realization of these goals may be the extent to which social equality, the need-fulfilment of all, full employment, the equitable distribution of income and wealth, and economic stability have been attained without a heavy debt-servicing burden, high rates of inflation, undue depletion of non-renewable resources, or damage to the ecosystem in such a way that endangers life on earth. Another test may be the realization of family and social solidarity, which is reflected in the mutual care of members of the society for each other, particularly children, the aged, the sick, and the vulnerable, and the absence, or at least minimization, of broken families, unwed mothers, juvenile delinquency, crime and social unrest.
Once economics gets into a discussion of human well-being in this comprehensive sense, then the task of economics may become wider and more complex. It may not be able to confine itself just to economic variables. It may have to take into account all those factors, including moral, psychological, social, political, demographic and historical ones, that determine well-being in such an all-inclusive sense. It may also have to answer a number of questions that may not need answering if its goal were only to help maximize wealth and consumption. One such question may concern whether the serving of self-interest is sufficient as a motivating force to realize comprehensive well-being or is it also necessary to have some other motivating force? Could such well-being be realized more effectively if all the agents operating in the market observed certain rules of behaviour and had certain desirable qualities? If so, then it may be necessary to impose certain constraints on individual behaviour. The individual may not then remain totally free to do what he pleases in accordance with his tastes and preferences. The question that then arises is about who will determine these constraints and how can it be ensured that the individual’s freedom is not unduly restricted. This because individual freedom is also essential for human well-being and it cannot be compromised except to a certain agreed extent.
In addition, there are a number of institutions in human society that influence individual and social outcomes. The market is only one of them. Others include the family, society and the state. The family is perhaps the most important of these because it provides the human input for the market, the society and the state. It is the primary breeding place and training ground for all individuals. It is here that a substantial part of individual tastes and preferences, personalities, and behavioural patterns are formed. The family’s health and solidarity are hence of crucial importance. If the family disintegrates, is it possible to provide the future generation with the kind of upbringing that it needs? If the quality of upbringing declines, then it may not be possible for a society to sustain its development and supremacy for long in economic, technological and military fields. Since economics is also concerned with the rise and fall of a society, is it realistic to ignore the integrity and stability of the family?
If the market, the family, the society and the state all have a role to play in human well-being, then the question is how to make them play their roles in a manner that complements yet does not hinder the effective performance of their role by others.While the market may operate efficiently if every individual tries to serve his or her self-interest, is it also possible for families, society, and the state to operate effectively and harmoniously if everyone were to behave in the same self-interested manner?
These are not new questions. They have been addressed by social philosophers for centuries. The majority seem to hold the view that the serving of self-interest is only one of the motivating forces in human society and that the maximization of wealth and consumption is only one of the goals. The spiritual and humanitarian goals stated above are of equal, if not greater, importance. Some of these goals may in fact conflict with each other and a compromise may need to be struck. But is it possible for a society to arrive at such a compromise if it sets maximization of wealth and consumption as its primary goal and its members are not willing to sacrifice their self-interest for realizing society’s humanitarian goals?
Sacrifice is of great importance in the case of the family and society. Experience shows that the more the parents are attached to each other and adopt an attitude of mutual sacrifice and cooperation, the greater harmony and stability there is likely to be in the family. The upbringing of children also requires a substantial degree of mutual cooperation and the sacrifice of parental self-interest. Similarly, social harmony may also require members to cooperate with each other, to sacrifice for the common good and to take care of the poor and the vulnerable. Even in the case of the market and the state, sacrifice may be unavoidable. In spite of competition, which helps safeguard social interest, it may be possible for operators in the market to make unjustified gains by cheating and obstructing competition in a manner that may be difficult to detect. Similarly, while democracy, public accountability, and a free press do help in protecting the public interest, it may still be possible for government officials to use their authority for personal benefit at the expense of the taxpayer.
Therefore, there has to be some motivating force that prevents individuals from wrongdoing even when it is possible for them to get away unscathed. Coercive government power has proved to be an effective motivating force. However, if this power were the only force in human society to prevent wrongdoing, the costs of enforcement may be very high. Is it possible to supplement competition, public accountability and coercive government power by some other motivating force that might induce members of society to abide willingly by agreed values or rules of behaviour, and to fulfil their contracts and social obligations faithfully even when this involves a sacrifice of self-interest?
This brings us to the question of why should any person sacrifice his or her self-interest for serving social interest either in the market place, the family, the society, or the government? If economics concentrates only on self-interest and has no place for a motivating force other than self-interest, then it may not be equipped to answer this question. If maximizing wealth and consumption is the only goal in the life of an individual, then there is no need to make any sacrifice for others. Serving self-interest is the best policy. Consequently, the family may then suffer, the quality of the future generation may decline, and even the performance of the market and the government may ultimately be adversely affected. The problem, therefore, is how to motivate individuals to fulfil their contracts and other commitments honestly and not to undermine competition or to resort to unfair means of earning even when it is possible for them to get away with it. This is the question which religions have tried to address by providing behavioural rules in the form of the moral obligations of individuals towards other human beings, animals and the environment, and by trying to motivate their followers to abide by these rules even when doing so hurts their self-interest. Whether or not they have succeeded in this task is a different matter. However, economics may not be able to ignore religious values and the associated motivating force if its goal is the realization of comprehensive well-being.
A society may have attained the pinnacle of glory in the material sense, but it may not be able to sustain it for long if the moral fibre of individuals and society is weakening, the family disintegrating, the new generation unable to get the kind of attention and upbringing that are necessary for an achieving civilization, and if social tensions and anomie are rising. The material and the spiritual aspects of well-being are not, therefore, independent of each other. Rather, they are closely interrelated. Greater family harmony may help raise better individuals to operate in the market, and better social harmony may create a more conducive environment for effective government and accelerated development. If this is true, then the emphasis on serving self-interest and maximizing wealth and consumption may have to be toned down so as to serve social interest and optimize human well-being. Some uses of resources which serve self-interest and fit well into the hedonist framework may have to be reduced to fulfil the needs of all individuals in society and, thereby, promote family and social harmony.
Available evidence supports the contention that material advance is not by itself sufficient to increase happiness and social harmony. “Rich countries are not typically happier than poor countries,” concludes Richard Easterlin after 30 surveys conducted in 19 developed and developing countries.5 There is something else that is also needed to create happiness and harmony and to remove tensions and anomie. Therefore, if economics concerns itself with well-being in its comprehensive sense, then it may not be able to confine its discussion to just material prosperity.6
How human well-being is defined is, therefore, an extremely crucial factor in the allocation and distribution of resources. If there is a difference in the concept of well-being, then there will also be a difference in the mechanisms and method for realizing it. There are three important mechanisms which determine the use of resources in any society or economic system. These are: filtering, motivation, and socio-economic and political restructuring.7 Just as it is possible to define well-being in a number of ways, it is also possible to have different mechanisms for filtering, motivation and socio-economic restructuring.
Firstly, all the different claims on limited resources need to be passed through a filter to create an equilibrium between all the claims on these resources and their supply, in a way that the realization of spiritual or humanitarian goals is not jeopardized. There may be different ways of filtering. Three of these are: central planning, market mechanism and moral values. Experience of socialist countries has shown that central planning is not an effective mechanism for filtering even in the material sense and almost all of them have abandoned it by now, except perhaps Cuba. However, market mechanism has performed extremely well. Prices determined through the interaction of supply and demand in perfectly competitive markets help filter out the various uses of resources in such a way that an equilibrium is established. But the problem with the use of market mechanism for filtering is that it is possible to have several market equilibria depending on which tastes and preferences of individuals and firms interact with each other in the market place. Any and every market equilibrium may not lead to the realization of humanitarian goals. It may, therefore, be desirable to complement the market system by some other mechanism that helps change individual tastes and preferences and which leads to the desired kind of equilibrium. Could moral values help bring about such a change?
Secondly, if coercion is ruled out, then the desired kind of filtering may have to be brought about by sufficiently motivating all individuals to put in their best performance and to abstain from using resources in a way that frustrates the realization of the desired kind of well-being. Motivation acquires great significance in economics as compared to say physics because economics deals with human beings who may or may not always behave in a set manner that is conducive to goal realization. The serving of self-interest has proved to be an effective motivating mechanism for increasing efficiency, while competition, public accountability, and government intervention have helped safeguard social interest. Would it be possible to safeguard social interest even more effectively if both market mechanism and government intervention are complemented by a sense of moral obligation?
Thirdly, physical, social and political environments also influence human behaviour and the use of scarce resources. It may, thus, be necessary to supplement both the filter mechanism and the motivating system by creating an enabling environment of economic, social and political values and institutions8 that influence individuals positively, and in a manner that is conducive to the realization of well-being in its comprehensive sense. This would bring into focus the need for socio-economic and political reform.
For example, if the need-fulfilment of all is accepted as a goal, and the operation of market forces does not automatically lead to this, then some arrangement may need to be made to realize this goal. If budgetary constraints prevent the state from playing an important role, then is it possible for the family and the society to share the burden? However, if the values or the structure of the families and the society have changed over time, making them unwilling or unable to share the burden, then is it possible for economics not to discuss the kind of socio-economic change that is necessary to realize its humanitarian goals? Its refusal to do so may be tantamount to giving blessings to the prevailing inequities. These might accentuate social unrest and tensions, which may ultimately lead to the decline of the society even in a material sense. Similarly, even if a society has values, but individuals are able to get away with dishonesty, bribery and other unfair means of earning because there is no effective system for detecting and punishing the culprits, then such practices may become locked-in through the long-run operation of path dependence and self-reinforcing mechanisms. Everyone may then condemn the practice but not be able to eliminate it single-handedly. Is it possible to eliminate undesired practices by just preaching sermons and not undertaking comprehensive reforms through socioeconomic and political restructuring? If such restructuring is needed, could it be brought about without the state also playing a supportive role? Is it possible for economics to abstain from discussing the kind of change that is needed and the role of the state therein?
If the mechanisms chosen by economics are not in conformity with the desired concept of well-being, or if the desired restructuring is not, or cannot be, brought about, then that kind of well-being may not be realized. Within this perspective, anything that prevents the kind of filtering, motivation and restructuring that the desired well-being requires may be termed as distortion, and any use of resources that does not directly or indirectly contribute to, or is in conflict with, goal realization may be considered ‘unproductive’, ‘inessential’ or ‘wasteful’. The role that the state plays in the economy may also be determined by the kind of filtering, motivation and restructuring that are necessary for realizing its vision.
The concept of well-being selected by economics as well as the filtering, motivation and restructuring mechanisms adopted by it are determined essentially by its worldview, which in turn tends to influence “the nature of man’s reflections on almost any subject.”9 Some of the questions that the worldview tries to answer concern how the universe came into existence, the meaning and purpose of human life, the ultimate ownership and objective of the limited resources at the disposal of human beings, and the rights and responsibilities of individuals and families towards each other and their physical and social environment.
Answers to these questions have a far-reaching influence on human thought and behaviour and lead to different theoretical frameworks and policy prescriptions. For example, if the universe is believed to have come into existence by itself and human beings are not accountable to anyone, then they are free to live as they please. Their purpose in life is to serve their self-interest through the realization of maximum wealth and consumption. The measure of their well-being would, in this case, be the extent to which they attain bodily pleasures and sensual gratifications.Survival of the fittest may perhaps be the most logical behavioural pattern. Value judgements may be unwarranted and all three filtering, motivation and restructuring mechanisms may be developed by human beings alone through reliance on their own reason and experience.
However, if all human beings have been created by the Supreme Being and the resources they have at their disposal are a trust from Him, then they are automatically all related to one another by a natural bond of brotherhood and are also accountable to Him. They are not then absolutely free to do what they please, but are rather expected to use the scarce resources and interact with each other and their environment in such a way that helps realize the well-being of all individuals, irrespective of whether they are rich or poor, white or black, male or female, children or adults. They would also be expected to ensure not only the realization of material goals but also spiritual and humanitarian goals, particularly social harmony and the absence of anomie. Here, Revelation and reason would both play an important role in filtering, motivation and restructuring, and value judgements would not be out-of-bounds.
The method of economics is also determined by its worldview. Linguistically, the term method refers to the rules and procedures of a discipline followed in a certain logical order to achieve a desired end.10 What the method essentially does is to provide criteria for the acceptance or rejection of certain propositions as a part of the discipline.11 The steps taken and the criteria for acceptance or rejection thus depend, as Caws has rightly indicated, on the end sought.12
If survival of the fittest is an acceptable behavioural pattern and if individuals are free to do what they wish in accordance with their preferences and their wealth, then the allocation and distribution brought about by market forces cannot be questioned. There would be no point in talking about humanitarian goals. Economics would accept the status quo, pass no judgement on it, and make no policy recommendations to change it. Its function would be just to describe (make positive statements about) how resources are actually allocated and distributed by the operation of market forces, and to analyze, theoretically as well as empirically, the relationship between the different variables involved in such allocation and distribution, with a view to helping make predictions about what may happen in the future. Economics would then be strictly a positive science with no normative role to play.
If, however, the purpose of economics is also to help realize humanitarian goals, then the method may not be just to describe, analyze and predict, but also to compare the actual results with the desired goals, to analyze the reasons for the gap between the two, and to show how the gap may be removed without unduly sacrificing individual freedom. Value judgements may not then be out-of-bounds. Since the purpose of Revelation is to help make such value judgements, it too may be welcome and economics may then be based on both Revelation, and reason and experience. There may then be no justification for creating a watertight distinction between its positive and normative functions, as both may be closely integrated and together constitute an indispensable part of its raison d’être.
The vision, the mechanisms, and the method of economics are all, therefore, the logical outcome of the prevailing worldview. Even though none of the current major worldviews is either totally materialist and hedonist or totally humanitarian and spiritual, there are nevertheless, significant differences among them in terms of the emphasis that they place on material or spiritual goals. The greater the difference in the emphasis, the greater may be the difference in the economic disciplines of these societies. Feyerabend frankly recognizes this in the Introduction to the Chinese edition of his thought-provoking book, Against Method, by stating that: “First world science is only one science among many; by claiming to be more it ceases to be an instrument of research and turns into a (political) pressure group.”13 Even with respect to institutional economics, the worldview of which is nearly the same as that of conventional economics and many of whose proponents feel that neoclassical economics and institutional economics are complementary rather than mutually exclusive, the Nobel Laureate, Professor Douglas North, clarifies: “Introducing institutional analysis into static neoclassical theory entails modifying the existing body of theory. But devising a model of economic change requires the construction of an entire theoretical framework, because no such model exists.”14
However, if there is a substantial difference even in worldviews and visions, there is no reason why there cannot be greater differences in the disciplines. One discipline may just seek to explain what exists, refuse to make value judgements, and not concern itself with social change for realizing a certain vision of life. Another discipline may not find ‘what is’ to be acceptable and so seek to help realize the desired social vision. A discussion of how, and through what process, the vision may be realized is then, perhaps, unavoidable.
To say that the effort to create Islamic Economics leads to isolationism15 is true only if arrogance and bigotry prevail in either one of the two disciplines and prevent mutual interaction. A rational and amicable discussion of different worldviews and disciplines may, in fact, promote greater depth and breadth in the analysis of both disciplines through cross pollination, and thus make the world richer and better off. Feyerabend is, hence, right in asserting that the “proliferation of theories is beneficial for science while conformity impairs its critical power. Uniformity also impairs the free development of the individual.”16
The above discussion may appear to be abstract, but once we start discussing conventional and Islamic Economics, it would be possible to see why the development of Islamic Economics is necessary if the Islamic vision of human society is desired to be realized.
Notes
1. Brzezinsky, 1995, p. 53.
2. Alfred North Whitehead, cited by Milton Myers, 1983, p. v.
3. See the three papers on “Economics and Happiness” by Oswald, Frank, and Ng, in the Economic Journal, November 1997, pp. 1812–58.
4. It may be useful to be clear about the difference between the terms distribution and redistribution. Distribution refers to the allocation of resources that takes place automatically through the operation of market forces. However, when a society uses extra-market or other non-market processes to change that distribution in accordance with the concept of justice embodied in its worldview, it is referred to as redistribution.
5. Easterlin (1973), in Heilbroner and Thurow, 1975, p. 538. See also Easterlin, 1995; Oswald, 1997.
6. Literature on the determinants of human well-being is growing rapidly. For a survey, see David Myers, 1993.
7. For a more detailed discussion of these, see Chapra, Challenge,1992, pp. 213–33.
8. Values refer in this book to the moral obligations of individuals towards themselves as well as to their families and society. They indicate the desired behaviour by specifying what is good or bad, right or wrong, and just or unjust. Their objective is to tone down the serving of self-interest by individuals to ensure justice, the well-being of all, and social harmony. The incentive for fulfilling moral obligations comes from love of God, and the desire to gain His pleasure and reward in the Hereafter. This may not, however, always be sufficient to make everyone act righteously. It is also necessary to have this-worldly rewards and deterrents.
Values become institutions when they are converted into formal rules, laws, conventions and constitutions, such that they are no longer just a moral obligation but also a legal obligation. The institutionalization of values implies setting in place a mechanism for detecting and punishing the violators, irrespective of their wealth and position.
9. Lovejoy, 1960, p. 7.
10. See the words method and methodology in Webster’s Ninth New Collegiate Dictionary. See also Caws, 1967, p. 339; Blaug, 1980, p. xi.
11. See Machlup, 1978, p. 54; Blaug, 1980, p. 264.
12. Caws, 1967, p. 339.
13. Feyerabend, 1993, p. 3; parentheses are in the original.
14. North, 1990, p. 112.
15. Kuran (1996) expressed this fear, p. 196.
16. Feyerabend, 1993, p. 5.
