Design of Islamic Economics

Design of Islamic Economics - In a discussion about what is meant by an Islamic economy, we must know in advance about the design and construction of an Islamic economy, by knowing the design of Islamic economics we can get a complete and thorough brief on Islamic economics.
The foundation consists of Islamic Economics: aqeedah/faith, fair, prophetic, caliphate. aqeedah/faith is the Muslim conception of the Deity of God Almighty, where Islam originated in the economic discussion of the ontology of monotheism, and this became the main principles of sharia, because the key person is a monotheistic faith which he held, so the first pillars of Islam which is the creed that show the importance of unity in every human being faithful. Therefore, every human economic behavior should be based on the principles by the teachings of Islam which comes from Allah SWT. Any action that deviates from the sharia will be banned, because it will be able to cause harm to human life both for people and for others. This will bring up the three basic principles are held by each person Muslim:
  1. The world and everything in it belongs to God and walk according to His will.
  2. God is the creator of all beings and all beings are subject to Him.
  3. Faith in the Day of Resurrection will affect the economic behavior of man according to the time horizon. 
Justice in this case implies that in any economic activity carried out is not the case an action that harms others. The concept of fairness has two contexts is the context of personal and social context. According to the context of the personal, not in economic activity, self-harm. Being in a social context, do not harm others. Therefore, a balance must occur between the two. This suggests that any economic activity performed by a man believed to be based on principles of justice, so that neither side of the oppressed. Character principal value of economic justice in society is to have a prosperous nature of justice and prosperity according to Islamic law. Related to the problem of economic behavior of humanity, then the purpose of justice has:
  1. Justice means a conditional liberty Islamic morality, justice is not limited only to lead to disharmony between the growth in production with special privileges for a small group to gather abundant wealth and sharpen the conflict between the powerful and ultimately will destroy the social order. 
  2. Justice should be established in all phases of economic activity. Justice in the production and consumption is an alloy of efficiency and combating waste. A tyranny and oppression where a person was left to his own property that exceeds the limits set and even to seize the rights of others. 
Many people assume that the guidance of the Islamic economy can only be run by the Prophet. This assumption is wrong, because science is taught by God through the intermediary of the Prophet Muhammad is true. With this prophetic concept, we are required to trust and believe that the science of God is true and will bring the salvation of the world and the hereafter, and can be run by all of humanity and not just by the Prophet alone, because the teachings of Prophet Muhammad is a doctrine that has values universal, so that the principles embodied in Islamic economics is a universal economic principles that can be applied by all people, whether by Muslims or Muslims but Islam.
Leaders carry the implication that the leaders of the people in this case could mean the government is something small but important role in the governance of social life. Islam teaches us to obey the leader while he remains in the corridors of Islamic teachings. This means that the state plays an important role in regulating all activities in the economy. This suggests that the regulation and the rule still needed, but they do not conflict with Islamic principles. In other words, the role of the state is trying to enforce the obligation and necessity to prevent the occurrence of the things that are forbidden.
This means, Islam permits to take advantage of economic activity. Therefore, a great mistake who think that in Islam may not take advantage. The advantage is one thing that is recommended in an economic activity. But that is forbidden in Islam is taking advantage of excessive let alone to the detriment of many, for example by hoarding to create scarcity of goods for which prices have doubled.
After discussing the Islamic economy, now we discuss about the economic pillar of Islam, which consists of:
  1. Multi-type ownership
  2. Freedom to act and social justice
Multi-type ownership, Islam recognizes the kinds of diverse ownership. In capitalist economies, ownership of which is recognized only individual ownership alone is free without restriction. While the socialist economies, only recognized joint ownership or ownership by the state, where individual ownership is not recognized and everyone gets the same reward. In Islam, both are recognized based on ownership boundaries in accordance with Islamic teachings. Therefore, Islam acknowledges the ownership of an individual, but still on the constraints that sharia should not be violated, such as the accumulation of capital is just piling on a bunch of classes. Individual ownership is held in high esteem in Islam, but still there are restrictions that limit so that no other party is injured due to individual ownership.
Ownership in Islamic economics are:
  1. Ownership lies in their emergence and not the absolute master of economic resources.
  2. Ownership is limited throughout the human lifespan in the world, and if the person died must be distributed to heirs according to the provisions of Islamic
  3.  Individual ownership is not allowed on the economic resources related to public interest or the livelihood of many people, these sources into the public domain or country.
Economic Freedom, in an Islamic economy every man is free to conduct any economic activity, as long as the economic activity undertaken is not economic activity that is prohibited in an Islamic framework. This is different from the capitalist economy that is not there may be restrictions in the freedom of activity that causes excessive freedom that occurs even cause oppressed others. In a capitalist economy, applicable law of the jungle where the strongest can master everything, including capital and natural resources. This leads to the loss of the rights of others resulting from freedom without limits, and not also as a socialist economy that is too limiting a person's freedom of activity, so that tends to eliminate the creativity and productivity of the people. Grossly excessive restrictions on economic activity led to stagnation in productivity.
Social justice (social welfare), in Islam the concept is not charitable - not because of the goodness of our hearts. In Islam, even though the property which we can derive from the business itself is halal, but there are rights of others, because we can not possibly get it all without help from others, either directly or indirectly. Therefore, Islam requires charity and voluntary sector (infaq, Sadaqah, endowments, and grants) to place equity in income distribution. Equity here does not mean the same flat, same taste, but according to the part. Instruments Zakat is one of the first equity instruments compared with a system of social security in the West. Besides coöperation (cooperative) is a character in the community versus the competition-free Islamic economy of capitalist society and the dictatorship of Marxist economics. Economic coöperation should be implemented in all levels of economic activity, production, distribution of goods and services. One form of coöperation in an Islamic economy is qirad. Qirad is a partnership between the owners of capital or money to the entrepreneur owner or staff ability or skills in the implementation of economic units or business project.  
The latter is the roof of the design and construction of Islamic economics, namely that the behavior of Islamic morality in the economy. Relation to the economy, could be interpreted as an ethic that must exist in every economic activity. Theory and principles of a strong economy is not enough to build a strong economic framework as to be equipped with morals. With the morals, the human in carrying out their activities will not harm others and maintained in accordance with sharia. Noble spirit capable of guiding the people in economic activities without harming the other party, such as by not doing gharar, maysir, and usury. Therefore, the superior theory and economic system in conformity with the sharia, there is absolutely no guarantee it will automatically advance the people's economy. Islamic economic system not only ensures the existence of transactions that are contrary to sharia. Economic performance depends on who is in it. Both the bad behavior of successful business entrepreneurs define and run a business failure.
By looking at the definition above, we can draw several terms, namely: First, Islamic Economics as a science is the foundation of this design. Second, Islamic economics as a system, or the Islamic Economic System is on the pole design. And Third, Islamic Economics as an economy, or the Islamic economy is what we call as the roof. 

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Islamic Economics

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