Mohammad Nadimur Rahman*
Human needs are unlimited, but resources are insufficient. So, it is necessary to use these resources effectively. Economics is a branch of knowledge that ensures the production, consumption and distribution of goods and services effectively and efficiently. Meanwhile, the distribution of wealth is an essential issue in the economic system. Accordingly, the two central conventional economic systems, namely socialist and capitalist systems, have different views on the concept of the distribution of wealth. On the other side, the Islamic economic system also has different opinions. These opinions are based on concepts of wealth distribution that enshrined the Quran and the sunnah.
In a socialist economic system, the government has complete control over the wealth of the people. Here the government collects all the wealth belonging to the people and distributes it among them equally. Thus, the socialist economic system is a centrally planned economy where the government has full right to interfere with people’s wealth. The negative side of socialist economic system is that people might not receive sufficient wealth. Some other people may get enough wealth to survive at a moment and not get at another. So, the income gap among the people can be wide even though the wealth is distributed among them equally.
The capitalist economic system is a market-oriented economic system where the government does not have any control over peoples’ wealth. Theoretically, the government does not interfere in the people’s wealth. So, the concept of the distribution of wealth among people is absent here. In a capitalist economic system, wealth is received by only those who are able to work in society. On the other hand, people who don’t work at all will not receive any wealth. Thus, the income gap in capitalist economic systems is vaster compared to socialist economic systems. Moreover, several statistical reports show that rich people are getting richer in a capitalist society while poor people get poorer. These are the leading causes of increasing unemployment and poverty worldwide, even in many developed countries.
Islamic economic system is quite different from both socialist and capitalist economic systems. While the socialist and capitalist economic systems are man-made concepts, the Islamic economic system is a divine revelation encoded in the Quran and the sunnah. In the Islamic economic system, wealth is distributed among the people not equally but equitably. People receive wealth according to their labour and needs.
For instance, Zakah, Waqf (bequest) and Sadaqah (alms) are major components of the Islamic economy. Zakah is a compulsory payment where all the rich Muslim people must pay. Waqf and sadaqah, on the other hand, are encouraged in Islam. Thus, the Islamic economic system is a concept where people with more than sufficient wealth distribute it to those who have less than enough wealth. The most amazing is that they do not necessarily lose anything because they will be granted a reward for this in heaven. Allah says: “Those who spend their wealth in the way of Allah and then do not follow up what they have spent with reminders [of it] or [other] harm will have their reward with their Lord, and there will be no fear concerning them, nor will they grieve.” (Baqarah: 262)
As a result, the possibility of income inequality is less in a society where the Islamic economic system is practised. In addition, it has been noticed that communities that are applying the Islamic economic system have not been affected by the 2008 world financial crisis. It should also be reminded that this economic system bans usury, which hinders people’s development financially. All these point to the fact that the Islamic economic system seems to be a more robust and resistant one than the ones mentioned above. Therefore, applying the concept of the Islamic economic system can minimize the gap between rich and poor in society. In the meantime, poverty and unemployment can also be solved by implementing the Islamic economic system.
* PhD Student (Economics), Erciyes University