Economics Atlas

How Wealth Is Ordered
Articles

Muhammad Baqir al-Sadr and the Case for a Third Way

Citation Formats

General Reference

APA Style

BibTeX

Learn More
Muhammad Baqir al-Sadr and the Case for a Third Way

This article records tradition as it has been passed down and reported. Its sources are not yet part of the atlas's verified catalogue.

Writing in Iraq in 1961, the Shia scholar Muhammad Baqir al-Sadr framed his task as answering a question the mid-twentieth-century world seemed to have already settled into two camps: capitalism, organized around private property and market prices, and socialism, organized around collective ownership and central planning. Iqtisaduna, Our Economics, argued that Islamic law offered a genuine third framework rather than a compromise between the other two. Private property and market exchange are permitted and central to the system, distinguishing it sharply from socialism, but riba, interest charged on a loan simply for the use of money, is prohibited, along with gharar, excessive contractual uncertainty, distinguishing it just as sharply from conventional capitalist finance. In place of interest, al-Sadr and the tradition he drew on prescribed profit-and-loss sharing contracts, a financier and an entrepreneur share the risk and the return of a venture together rather than the financier collecting a fixed return regardless of outcome, alongside zakat, an obligatory annual levy redistributing a share of wealth to the poor. The book became a foundational text for the modern Islamic economics and Islamic banking movements that grew rapidly from the 1970s onward.

Cross-Tradition Connections

Article On

Sources
Comments (0)
No comments yet. Be the first to share a thought.
Reader Challenges (0 open reader challenges)
No disputes yet. Spotted an error or a better source? Open the first one.

View At A Past Year

The atlas records no dated fact of its own for this entry, so there is no other year to choose.