Islamic Finance and Political Economy

Schumpeter’s Great Gap and Contribution of Islamic Scholar’s During The Great Gap

1. Introduction

Islamic political economics is fundamentally a perspective of human well-being and norms that applied in a society that integrate with Islamic principle which derived from ontological sources of Quran and Hadiths (Langton, et al., 2011). The axiom of Islamic principle is its belief in God and hereafter objective (Abdul-Rahman, 2010). Hence, this framework, in general, is not much different compared with how Christianity shaped Western world. Similarities between Islamic economics and secular are the same perspective on utilization of resources and self-fulfilment by ethical system throughout society (Langton, et al., 2011). Although share almost the same value, Muslim scholar has failed to address their contribution in today’s literature and economic study (Ghazanfar, 1995). Therefore, it is important to find the root cause of the ignorance of Muslim scholars.

2. Western Ignorance of Islamic Scholar’s Contribution (The Great Gap)

Modern economist generally dates back to late 18th century when at that time have ethnocentrism tendency and avoidance of normative perspective that lead to neglect economics scholar outside European-Western scope.(Ali & Thompson, 1999). Joseph A. Schumpeter (1883-1950), an economist expert, defines an idea known as “The Great Gap” in his work The History of Economic Analysis. He argue that economics science is started to form during the Greek philosophical era of Aristotle and then jump into Latin Scholasticism of St Thomas Aquinas in the thirteenth century that leads to 500 years gap or known as the Great Gap. During this gap he argues that there is no significant economics nor scientifically discoveries have been made. This statement is arguable by the fact that during medieval era, Arab-Muslim scholars contribute many thought including economics (Ghazanfar, 1998). Some Arab-Islamic scholars that widely known during the Great...