Incentives and Creative Destruction in Deen/Islam

Posted: July 30, 2015 in Consumerism, Monetary System
Tags: , , ,

An oft repeated argument by numerous commentators about the benefits of free markets and capitalism is the incentive system it fosters.

Whilst constructively shaping human behaviour is needed in order to positively reinforce the benefit humanity can bring to the wider universe/environment, a question continues to linger about what type of incentive do alternative systems propose, and can they indeed work?

This post by a Muslim Counter Racist activist sheds meaningful light here and in my opinion makes a compelling argument if fully analysed

One particular point I would like to highlight here is the final part;

If this all sounds too ‘idealistic’ and ‘anarcho-libertarian’, I should like to draw attention to the closing phrase in this sign / indicator (ayat) – which is also the closing phrase of this enclosure / chapter (surah), viz. “and if you turn away, He will replace you with another people; then they will not be the likes of you.” In short, if a people are not willing to measure up to this ‘ideal’, then they will be replaced by others.

Capitalism might appear robust and permanent, but it is nothing but the ‘froth’ that mounts up on the surface of the water and is destined to pass.

I draw your attention to this because it ultimately plays to another well rehearsed attribute of capitalism and pluralism which should be supported; the idea of ‘Creative Destruction’, if an idea is deemed to fail, then it should be allowed to, naturally (no bail-outs/artificial support), and a more robust, stronger idea will take its place by having learnt from the weaknesses of what came before.

The true form of Deen-al-Islam is not with us in the contemporary world and how can we therefore assess accurately if it can indeed work. If it is not implemented correctly, it will indeed fail.

How do we assess whether our flirtation with capitalist principles have failed – do we really have the freedom to choose to replace it, or have we been coaxed into believing that it works?

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