Islamic Economic Principles and Modern Economic Principles: A Comparative Study

اسلامی معاشی اصول اور جدید معاشی نظام : ایک تقابلی مطالعہ

Abstract

This research presents a comparative study between Islamic economic principles and modern economic systems, particularly Capitalism and Socialism. Islamic economics is rooted in divine guidance, prioritizing justice, equality, and social welfare. It emphasizes the ethical use of wealth, prohibits interest (riba), and discourages exploitation, aiming to establish an interest-free and morally responsible economic structure. The system promotes wealth circulation, fair trade, and the protection of both individual and collective rights. In contrast, modern economic systems, such as Capitalism, are based on private ownership, market freedom, and profit maximization, often resulting in social inequalities, concentration of wealth, and a competitive environment that may neglect the underprivileged. Socialism, while aiming for economic equality through state ownership and distribution, may suppress individual freedom and initiative. This study highlights how Islamic economics offers a balanced approach that integrates material and spiritual dimensions, while modern systems tend to separate economics from ethical values. The paper further evaluates the effectiveness of each system in addressing issues of poverty, economic justice, and equitable distribution of resources. Through analytical comparison, the study concludes that Islamic economic principles provide a sustainable and humane alternative that prioritizes collective welfare over individual greed, thus offering viable solutions to the imbalances faced by modern economies.