Islamic FinanceNewsOpinions

The Psychological Role of Islam in Economic Development (Part-1)

My faith and conviction have grown that the umma has actively begun to open up to its true mission represented in Islam, and to realize, despite the various types of colonialist delusion, that Islam is the way of salvation and that the Islamic system is the natural framework within which it must achieve its life and release its potential. It is on the foundation of Islam that the umma must create its existence.

The umma is living out a holy war (jihad) against backwardness and collapse, attempting politically and socially to move towards a better existence in a more firmly rooted entity with a richer and more prosperous economy. After all the attempts made, some wide of the mark, others less so, it is clear that the umma will never find the way except in following the Islamic line. It will never find the framework within which to work out the solution to problems of economic backwardness except in the economic framework of Islam.

Mankind, beset by tormenting anxiety as it oscillates between the two world currents which are mining its path with bombs and rockets and ~ means of destruction, will never find salvation except at the one door to heaven which remains open, Islam.

When the Islamic world opened itself up to the life of European In and conceded the precedence of the latter and its leadership of the ma/~ of civilization, it turned from its authentic mission of conducting the I~ of mankind. The Islamic world accepted t~1e European classification of the world according to economic criteria of rich and poor and found itself in the category of the poor countries which, in the logic of the Europeans, ha~ no choice but to admit the leadership of the developed countries and allow them to breathe in their spirit and plan the way for the poor countries to rise up.

The Islamic world’s subordination to the pioneering experience of European man in modern civilization found expression in three contemporaneous forms-forms which are still found in various parts of the Islamic world:

1. Political subordination in the direct rule of economically advanced European peoples over backward peoples;

2. Economic subordination which accompanied the setting up of politically independent entities for government in various countries. This found expression in giving room for European economy to perform its role on the stage of that country in various forms-exploiting raw materials, filling the void with foreign capital, monopoly of several economic services on the pretext of preparing the people of backward countries to bear the burden of the economic development of their country;

3. Subordination in the program followed in many an attempt within the Islamic world to get free of the dominant European economy and to begin to think of relying on one’s own power to develop the economy and overcome backwardness. It was impossible to conceive one’s own understanding of the nature of the problem embodied in one’s economic backwardness outside the framework of the European understanding of it. One found one’s self called to choose the same program which European man followed in building his towering modern economy.

The modern experiments at economic building in the Islamic world ordinarily faced two forms of experience in economic building in modern Western civilization, namely, free economy based on capitalism and planned economy based on socialism. Both of these forms a sizeable experience in constructing the modern European economy. For application in the Islamic world there was study to see which of the two forms merited to be followed as more capable of assuring success in the struggle of the umma against economic backwardness and in building an economy.

The Islamic world leaned towards capitalism because the capitalist axis of European influence was quicker ~o make inroads.

Then during the umma’s political struggle With colonialism and its attempt to liberate itself from t e capita 1st axis, some of the experimental governments found that the European opposition to the capitalist axis was the socialist. Thus there developed another tendency leaning towards the choice of the second form for development (i.e., planning on a socialist base). It was a way of .combining faith in European man as the pioneer for backward countries With the actual struggle against the politics of capitalism. The economic subordination of backward countries to the developed ;~posed faith in the European experience .as pioneer, but the emotions provoked by the battle against the lived reality of colonialism clashed with ~le capitalist wing of this experience, so socialist planning was chosen as another form of the pioneer experience.

Each of the two tendencies has proofs to justify its point of view. The first usually argues that the great progress which the European capitalist countries have made, their levels of production and industry, is because of their free economies. They add that it is possible for backward countries if they follow the same style and live the same experience, to shorten the road and make the leap to the desired level of economic development in a shorter time because they will profit from the expertise of the capitalist experiment of European man and use all the scientific capacities which it took him hundreds of years to gain.

The second tendency explains its choice for planned economy on a socialist base rather than a free economy because, although free economy was able to realize great gains and continued progress in technology and production and growth of domestic resources for pioneering European countries, It is not possible that It play the same role in backward countries today. Backward countries today face a formidable challenge in the great progress made by the Western states and at the same time are confronted With unlimited competition.

Both tendencies, to explain their failure in the area of application point to the artificial conditions created by the colonialists in the region in order to hinder the operation of development. Though they sense failure, they do not allow themselves to think of any program which might offer an alternative to the two traditional forms which modern European experience took in the east and in the west. And yet there is an alternative, ready made, alive in the theory and belief of the umma even though it has been segregated from practical application-the Islamic program (manhaj) and the economic system (nizam) of islam.

Here I merely wish to compare the two wings of European economy, capitalism and socialism, with Islamic economy from the point of view of their capacity to share in the battle of the Islamic world against backwardness and to offer a. framework for its economic development. To Judge this It is not sufficient to focus on the theoretical data of each of the two, but it is even more necessary to note in detail the objective conditions of the Islamic umma, and Its psychological and historical composition.




Since the umma is the field in which the economic program is applied, it . necessary to study the specificities and conditions of this field to see h IS effective the application of one or other of the systems may be.

The effectiveness of the free capitalist system or that of socialist planning in the European experience does not necessarily mean that the program in itself is effective and that wherever it is followed it will be equally effective. Rather, the effectiveness of the program may come from the fact that r Europe it formed part of an integrated whole and was a link in the chat of Europe’s history. It is possible that if the program is isolated from it~ general frame and history that it will not be effective.

A comparative study of numerous economic schools and the possibility of their succeeding practically in the Islamic world bring to the fore a basic truth which must be the ground of any judgment. It is this: the need of an economic program for economic development is not merely the need for a framework for social organization which the state adopts and adheres to. No, economic development and the battle against backwardness require a framework which is capable of incorporating the umma and which stands on a base with which the umma can interact. The movement of the whole umma is a basic condition for the success of any development and of any comprehensive battle against backwardness. The movement of the umma expresses its growth, the growth of its will and the release of its inner talents. If the umma does not grow, there can be no process of development. The development of external resources and internal growth must go hand in hand.

The experience of European man is a clear historic expression of this truth. There was success on the material level because European peoples interacted with these programs in all aspects of life. The tendency of these programs was in accord with their aspirations and their psychology, formed during long years of assimilation and interaction.

When we want to choose a program or a general framework for economic development in the Islamic world, we must take this truth as a basic in choosing the ship capable of moving the umma and mobilizing all Its potential for the battle against backwardness. We must take account of the feelings of the umma, its psychology, its history and its various intricacies.




There are, for example, particular psychological feelings concerning colonialism which the umma in the Islamic world experiences. There is doubt suspicion and fear resulting from a long, bitter history of exploitation anof struggle. These feelings cause the umma to recoil from the organization of European man.

It was the clarity of this truth that made many of the political blocs in the Islamic would think of taking nationalism as a philosophy and foundation for civilization and as a basis for Social organization. They were full to bring forward slogans which were completely separated from the ideological entity of colonialism. Nationalism, however, is nothing but an historical and linguistic tie; it is not a philosophy With principles, nor a creed with foundations. By Its very nature It is neutral concerning the various philosophies and social, ideological and religious schools. For this reason it has to adopt a specific point of view concerning the universe and life, and a particular. philosophy on the basis of which it can formulate the main lines of its social organization, Its renaissance and Its civilization.

Apparently many of the nationalist movements felt this and realized that nationalism as raw material had need of adopting a certain social philosophy and system. They tried to reconcile nationalism with authenticity through the slogans they raised and thus cut it off from European man, so they called for Arab socialism. They called for socialism because they realized that nationalism alone was not sufficient; it needed a system. And they called for socialism in an Arab framework because they discerned the sensitivity of the umma to any slogan or philosophy tied to the world of colonialists. By describing socialism as Arab they tried to cover the foreign reality it represented from the historical and ideological point of view. But it was an unsuccessful cover; it did not fool the sensitivity of the umma because this uneasy framework was nothing but a purely external and formalistic framing of the foreign content represented in socialism …. The propagandists of Arab socialism were not able to distinguish between Arab socialism and Persian or Turkish socialism, nor could they explain how socialism differed merely by giving it this or that nationalist framework because the fact is that the content and substance were no different. This framework only expresses exceptions which differ from one people to another according to the type of traditions reigning among the people.

Despite the fact that the propagandists of Arab socialism failed to present a truly new content for this socialism by placing it in an Arab frame, still this action of theirs confirms what we stated earlier, namely that the umma, because of the sensitivity resulting from the era of colonialism, cannot construct a new renaissance save on an authentic base which is not connected in the mind of the umma with the colonialist countries themselves.


It is here that the great difference emerges between the programs of European economy and the Islamic program. The European programs, in the mind of the umma, are tied to the man of the colonialist continent, no ll1atter what framework is drawn up for them, but the Islamic program, In the mind of the umma, is bound up with its history and proper glory and expresses its authenticity with no imprint of the colonialist countries. The feeling of the umma that Islam is its proper expression, the title of its historic personality and the key to its former glory is considered an extreme I weighty factor for success in its battle against backwardness for development when the program is derived from Islam and chooses the Islamic system as the framework for its point of departure.

Besides the complex feelings of the umma in the Islamic world toward colonialism and all programs connected with colonialist countries, there is also another complication which presents a sizeable difficulty blocking the success of new European economic programs applied in the Islamic world. It is the contradiction between these programs and the religious creed which Muslims live. Here … I merely want to underline this Contra_ diction between the programs of European man and the religious creed of Muslim man, characterizing this creed as a living force in the Islamic world without giving any value judgment. Whatever our estimation of this force may be as a result of the disintegration and decline which followed from the action of colonialism against it in the Islamic world, it still has momentous influence in directing behavior, shaping feelings and defining a point of view towards things. We acknowledged above that the operation of economic development is not merely one which the state adopts, puts into practice and legislates for; it is an operation in which the whole umma must participate and share in one way or another. If the umma senses a contradiction between the framework imposed for development and the creed which it still reverences and whose outlook on life it guards, at least on some points, then to the degree that it acts in accord with that creed it will recoil from contributing to the operation of development and from being drawn into the imposed framework.

The Islamic system, on the contrary, does not “face this complication; it suffers no contradiction in this respect. Rather, if it is applied, it will find in the religious creed a huge support and a helping factor for the success ~f the development placed in its framework because the basis of the Islamic system is the rules of the Islamic Sharia and these are rules in the sanctity and inviolability of which the Muslim usually believes. He has an obligation to carry them out by force of his creed and his belief that Islam IS a religion revealed by heaven to the seal of the prophets.

Without a doubt, the most important factor in the success of the programs adopted to organize social life is the respect which people have .f~ them and their belief that these programs should be executed and applied.


There is in fact an Islamic morality alive to one or other degree in the Islamic world and there is a morality of European economy which accompanied modern Western civilization and wove for it its general spirit and prepared the way for its success on the economic level. The two moralities differ substantially in their orientation, their point of view and their value systems. To the extent that the morality of modern Western man is sound for European economic programs, the morality of man in the Islamic world or incompatible with it. This morality has deep roots which cannot be extirpated by merely diluting the religious creed.

Planning-any planning for the battle against backwardness-must necessarily take into account the resistance of nature in the country for which the plan is intended, the degree to which it will resist operations of production. So too, account must be taken of the resistance of the human element and the extent to which it is in harmony with this or that plan.

The European man looks always to earth, not to heaven. Even Christianity, the religion in which European man believed for hundreds of years, was not able to overcome his earthly tendency. Rather than the Christian raising his view to heaven, he was able to bring the God of Christianity down to earth and incarnate him in an earthly being.

The attempts to tie man’s lineage to groups of animals and to explain humanity as an objective adaptation to the land and environment in which it lives, or the scientific attempts to explain the whole human edifice on the basis of productive forces which represent the earth and the potential within it, these attempts are nothing other than endeavors to bring God down to earth. This is their psychological signification. They are all morally tied to that deep-seated view in the soul of European man towards the earth, even though their style and scientific or mythical character may differ.

This view towards the earth allowed European man to give values to matter, resources and property which harmonize with his basic orientation.

The values rooted in European man over the ages expressed themselves in schools (madhahib) of sensual delight and pragmatism which inundated moral philosophic thinking in Europe. These schools, in as much as they were the product of European thought, registered great success in Europe. They had psychological significance and meaning for the general temper of the European soul.


In the same way, European man’s cutting of the true tie with his God and IS looking to earth instead of to heaven snatched from his mind any true notion of a lofty presence on high or of limits imposed from outside the circle of his own self. This prepared him psychologically and nautically to believe in his right to liberty and to submerge himself in a flood of feelings o Independence and individualism ….

Freedom played a principal role in European economy and the operation of development was able to use to advantage the deep-rooted feelings the European man concerning freedom, independence and individualism for t e success of free economy; it was a means in accord with the deep-rooted tendencies in the souls and minds of European peoples.

We all know that the deep sentiment of freedom provided a basic Condition without which many of the activities in the process of develOPl1le n. would never have taken place-that condition was the absence of any feeling of moral responsibility.

Freedom itself was an instrument to open up European man to the concept of struggle because it set every man loose from all limits save the e of the presence of the other person opposite him. Every individual, by hat existence, formed a limit to the liberty of the other person. Thus the notion of struggle grew in the mind of European man, and this notion express~~ itself on the philosophical level, as we said in the other basic thought which went to make up the mixture of modern Western civilization. This notion of struggle expressed itself in scientific and philosophical ideas of the struggle for existence as a natural law among all living beings Or On the inevitability of class struggle within society or on dialectical movement and the explanation of the universe on the basis of thesis, antithesis and the synthesis arising out of the struggle between two contradictories. All these tendencies which bear a scientific or philosophical stamp are before all else an expression of the general psychological state and the vehement feelings of the man of modern civilization concerning struggle.

Struggle had a great effect in orienting modern European economy and the operations of development which accompanied it. This was so whether it took the individualist form and expressed itself in fierce unlimited competition between personal capitalist institutions and projects under a free economy, developing all resources through competition and struggle for existence, or whether it took the class form and expressed itself in revolutionary groups which took over the key positions of production in the country and moved all potential to the benefit of economic development.

This is the morality of European economy and on these grounds this economy was able to set itself in motion, achieve growth and register huge gains.


This morality differs from that which the umma in the Islamic world lives as a result of its religious history. Eastern man, brought up on the heaven Y missions which lived in his lands, extensively educated in religion by Islam, naturally looks to heaven before he looks to earth. He accepts the 1nvisble world before the world of matter and sense. His deep infatuation with the invisible world expresses itself on the level of thought in the life of Mus!trtll by the orientation of thought in the Islamic world towards the intellectua spheres of human knowledge rather than those tied to sense reality.

This profound other-worldliness in the charact~r of Muslim man 1J;~i5 the seductive force of matter for him and Its capacity to Impress hun. al fact explains why man in the Islamic world, when he is deprived of rn~r it motives for interacting with matter and finds no enticement to exploit it, tends to take a negative attitude towards it-an attitude which takes the form of asceticism at times, temperance at others or even laziness at others.

This other-worldliness has trained him to feelings of an unseen super-vision which may express themselves in the pious Muslim’s consciousness v1~iS clear responsibility before God Almighty, or in the mind of another M slim as a well defined and directed conscience. In any case, it keeps man . in the Islamic world far from sensing personal freedom and moral freedom in the way European man does.


This internal limitation felt by Muslim man has its moral base in the interests of the community in which he lives; consequently he feels a profound tie with the group to which he is related. There is harmony between him and the community, not struggle, the notion which dominates modern European thought. This notion of community reinforces the world framework of the mission of Islam for the Muslim and charges this mission with the responsibility of assuring its presence in the world and its extension in time and place ….

If we look on this morality which man in the Islamic world lives as a truth represented in the being of the umma, we can put it to use in the economic program within the Islamic world by placing that program in a framework which marches with that morality so that it may become a force of impulsion and movement just like the morality of modern European economic programs was a great factor in the success of those programs because of the harmony between the two.

The regard of man in the Islamic world towards heaven before earth could lead to a negative attitude to earth, its resources and goods asceticism, moderation and laziness-if earth is separated from heaven. If, however, earth is clothed in the framework of heaven and action with nature is given the quality of duty and worship, then this otherworldly view IS transformed for the Muslim man into active energy and impulsive force ~o participate to the greatest degree possible in raising the economic level. instead of the coldness towards earth which the negative Muslim feels Today, or the psychological anxiety which the active Muslim who follows ~ e styles of free economy or socialism feels for the most part, even though be IS a watered down Muslim, there will be generated a full harmony between the psychology of the man of the Islamic world and his anticipated positive role in the process of development.

The concept of internal limits and other-worldly supervision which prevents man in the Islamic world from living according to the European motion of freedom can help to avoid, to a great degree, the difficulties which spring from free economy and hinder economic development by providing moral justification for general planning.

Group ties and sensibilities can share in mobilizing the energies of the Islamic umma for the battle against backwardness If the battle IS Waged under a slogan which coincides with those sensibilities, such as jihad f preserving the essence and existence of the umma. This is what the Quran does when it says: Make ready for them all that you can (Sura viii, 60). The order is to prepare all forces including the economic which are represented by the level of production as part of the battle of the umma and its jihad to preserve its existence and sovereignty.

This brings out the importance of the Islamic economy as an economic program capable of using to advantage ~he morality of man in the Islamic world and transforming it into a great impulsive and constructive energy for operations of development and for success in sound planning for economic life.

When we adopt the Islamic system we will profit from this morality and be able to mobilize it in the battle against backwardness, contrary to what would happen if we adopted the programs in economy which are psychologically and historically rooted in the ground of another morality.


Some European thinkers have begun to realize this truth and to take note of it, acknowledging that their programs do not accord with the nature of the Islamic world …. I would like to expand on this on another occasion, for now suffice it to say that the orientation of man in the Islamic world towards heaven does not in its authentic sense mean that man submits to fate and relies on the conditions, opportunities and feelings of complete incompetence concerning creativity and invention … rather this orientation of Muslim man is a true expression of the principle of the stewardship of man on earth. By his very nature he inclines to see his position on earth as an expression of his stewardship to God. I know of no concept richer than this for affirming the capacity of man and his energies; it makes him the absolute master of the universe. And I know of no concept further removed from surrender and fate than the concept of stewardship to God because stewardship gets to the bottom of the sense of responsibility concerning what one is made steward of. There is no responsibility without liberty and a sense of choice and an ability to master circumstance Otherwise, what stewardship would this be if man was bound or remotely controlled? For this reason, we say that clothing the earth m the framework, I of heaven releases the energies of Muslim man and stirs up his potential, d h’ an whereas cutting earth off from heaven annuls the sense of stewardship fixes the view of Muslim man on earth in a negative way ….


In addition to all that precedes, ~e would like to remark that taking Islam as the basis for general organization allows us to set up all of our life, both spiritual and social aspects, on one foundation because Islam extends to both whereas many of the social programs other than Islam are limited to the social and economic relations in the life of man and his ideals. If we take our general program for life from human sources instead of the Islamic system, we leave the organization of the spiritual side unsatisfied. There is sys sound source for the organization of our spiritual life except Islam. ~~ere is no way but to establish both sides, spiritual and social, on the foundation peculiar to Islam. Moreover, the two Sides are not isolated from one other but interact to a great degree. This interaction makes It more sound and harmonious to set up the two on one base given the unmistakable inter-connection of spiritual social activities in the life of man.


Born in Baghdad, Baqir al-Sadr (1933-1980), was an intellectual, religious, and political leader, who excelled in religious studies in Najaf and wrote his first book, Our Philosophy, in 1959. This was followed by Our Economy (1960), among the most influential twentieth century books on Islamic economics, as well as other works on Quranic interpretation, jurisprudence, theology, and philosophy. A member of the jama’at al-Ulama in Najaf, founded by his uncle Murtada Al Yasin in 1960, he published the review allAdwa’. Baqir al-Sadr is also credited with having begun a reform of the courses of study in Najaf and had a project to reform the institution of religious leadership. His published fatwas are considered innovative. Two fatwas led to his elimination by Saddam Hussein’s government. One prohibited membership in the Ba’th party and praying behind Imams who collaborated with the regime. The other called for open armed struggle against the regime. On April 8, 1980, he was liquidated along with his sister, Bint al-Huda.


Related Articles

Back to top button