There is a growing amount of literature that tries to explain what institutions are, how they are established and how they can be reformed for desired social and economic development. This paper explores key institutional values needed for transformative socio-economic development in the Muslim world. The paper begins by examining the role of uplifting institutional values found in the Golden Ages of the Muslim world and how they moved to the West. It then presents new institutional economics as an effective tool to understand long-term development. The paper adds a new layer to institutional economics literature by addressing the importance of hidden internalized institutional values (liberty, critical thinking, justice, rule of law, equality, participatory culture, accountability, competency, punctuality, and plurality) in explaining the socio-economic success of the West and failure of the Muslim world over the last few centuries. The paper concludes with some developmental policy recommendations for Muslim countries based on these internalized institutional values.

Purpose Given the fact that the Islamic economic paradigm differs from the secular capitalist paradigm in terms of its emphasis on morality and spirituality, the author thinks that the current Human Development Index (HDI) does not capture human development from an Islamic perspective. The purpose of this paper is twofold: first, to provide a paradigmatic, theoretical, and conceptual model for the suggested Islamic HDI (iHDI) and second, to present several proxy variables for multi-dimensional iHDI and test the proposed index through empirical data for ten Muslim countries. Design/methodology/approach The author developed eight-dimensional composite iHDIs based on the understanding of human nature from the Tawhidi anthropology. These dimensions included physical, reasoning, spiritual, ethical, animal, social, deciding, and oppressive selves. The author measured them using nine different indices, three of which came from the conventional HDI (cHDI). The author then compared the rankings of those Muslim countries in iHDI to those in cHDI. Findings The iHDI rankings for all Muslim countries except two differed from those in cHDI. The difference was more substantial for countries with higher economic development. Thus, improved cHDI rankings for Muslim countries based on their economic development do not necessarily mean that they move toward ideal human development. This finding confirms the need for an alternative human development indexing approach from an Islamic perspective. Research limitations/implications The paper is likely to initiate movement to develop an alternative HDI from Islamic perspective. Practical implications The paper findings have important policy implications for Muslim countries. Originality/value It is the first empirical paper showing how to develop an alternative HDI from an Islamic perspective.

© 2017 Springer Science+Business Media Dordrecht The paper explores Islamic morality within labor market realities. It presents Islamic moral axioms that are expected to guide employer–employee relationships. It provides an extensive review of Islamic moral ideals related to fairness in the labor market. Based on survey data from 319 individuals in the Saudi labor market, it tests three hypotheses related to religiosity, secular aspirations, and perception and practice of fairness in the labor market. Using multinomial logistic regression, the findings from several models clearly support all three hypotheses. They show that employers, owners and senior managers were more likely to consider market reality as their reference for describing fairness. Ideally speaking, the regression results confirm that being religious contributes positively to the sense of fairness even in a secular context. However, they also reveal that secular aspirations override religious ideals when it comes to market realities. In other words, when people place great importance on worldly outcomes, religious ideals have almost no impact on their labor market practices even if they ideally support fair practices. The study concludes that religious morality does matter with regard to fairness in employer–employee relationships only if it is not superseded by secular aspirations. Those who have a high-level of religiosity consider themselves to be fairer. However, if they embrace secular aspirations, they are less likely to practice their moral ideals in the labor market.

© 2017 Emerald Publishing Limited. Purpose - Previous research using the Aspiration Index (AI) suggests that intrinsic goals are positively, but extrinsic/materialistic goals are negatively associated with subjective well-being (SWB). The purpose of this paper is to extend the scope of previous research by exploring the pursuit of different goals in conjunction with SWB in a country with a culture mixing western and traditional values. Several hypotheses regarding the effects of extrinsic, intrinsic, hedonic, and self-transcendent values on SWB were tested. Design/methodology/approach - An extended AI survey was conducted among randomly selected cross-sectional sample of 878 Turkish adults in Istanbul. The survey data were analyzed to explore the relationship between 14 aspiration domains and SWB using both correlation coefficients and several different regression models. Findings - The study confirms the basic assumptions of the AI research in a Muslim society with a hybrid culture of materialistic and spiritual aspirations. The study found weak supporting evidence for the contribution of two newly added domains (i.e. aesthetic appreciation as well as honesty and fairness) to SWB, whereas the evidence for the positive contribution of intellectual life was overwhelming. Paradoxically, although the evidence from both correlation and regression coefficients supported a positive relationship between household income and SWB, after dividing the sample into two groups based on their income level, the low-income earners turned out to have relatively higher life satisfaction, holding everything else constant. More importantly, the study reveals that the impact of materialistic aspirations on SWB is still negative even if they are pursued in a hybrid culture. Research limitations/implications - The study included three new domains in the conventional AI model. Although the findings confirmed the importance of two domains, it is important that they be replicated in other studies, particularly in different cultural settings. Originality/value - This study makes a significant contribution in terms of testing the effect of materialist and spiritual values on SWB in a Muslim country.

This paper discusses the relationship between consumer culture and hedonic happiness model promoted by free market capitalism showing that the Islamic way to happiness is different from hedonic happiness which leads to conspicuous consumption.

Well-being, as studied in the West, is often related to intrinsic not extrinsic values. Unfortunately, there are no similar studies for Muslim societies. This study will be one of the first of its kind conducted on Muslim group capturing 15 different domains of their life experience. The purpose of this study is to determine how well-being is related to materialistic, hedonic and moral values in one group of Muslims. The study seeks empirical evidence regarding the impact of Islamic values compared to materialistic and hedonic values on subjective well-being. The survey data is used to test a comprehensive theory of human nature and happiness model from an Islamic perspective to see whether it helps to achieve more happiness with less/moderate consumption. It has a great potential to explain whether Islam could provide authentic happiness to humanity in this life.

The paper argues that crises of capitalism are rooted in its secular paradigm. Therefore, it is not possible to overcome social, economic, moral, environmental crises of modern societies through some modification of free market capitalism. We need an alternative model based on a new paradigm. The paper presents "moral market" as an alternative economic model to free market capitalism. This is taken from the writings of Said Nursi. It argues that the moral market differs from free market capitalism because while the former relies on the Tawhidi paradigm, the latter on secular paradigm with corresponding ontology, epistemology, anthropology, and teleology. The paper provides extensive discussion of the Tawhidi paradigm from Nursi's perspective. It also attempts to redefine maqasid-i sharia and maqasid-i iqtisad based on the Tawhidi paradigm. It concludes with a comparison of the moral market and free market capitalism in terms of their guiding principles, which are derived from their corresponding paradigm.

The 2008 financial crisis has touched almost every nation around the world resulting in the loss of trillions of dollars in wealth. People began seriously questioning the fundamentals of free market system. While some blame politicians, bureaucrats, and corporate leaders for their mistaken policies, others blame human nature. In Alan Greenspan’s terms, “The cause of our economic despair, however, is human nature’s propensity to sway from fear to euphoria and back.” Greenspan is not the first one blaming human nature for economic crises. John Maynard Keynes made a similar point in his famous recession prescription book, The General Theory of Employment, Interest and Money. Many other economists refer to human nature in their works as well. For Bentham, it is human nature to pursue pleasure and avoid pain. For Adam Smith, it is human nature to act based on “self-interest”. However, no one elaborates on human nature which stays like a “black box” from which key assumptions in free market system are derived. This paper is an attempt to unlock the black box of human nature to better understand the crises of capitalism, including the most recent one. Even though the author agrees with Greenspan that the current financial crisis, and perhaps all economic crises, is driven by human nature, he disagrees with him that such crisis is unpredictable and unpreventable. The paper offers a new theory of human nature from an Islamic perspective to predict and prevent irrational and irresponsible behaviors of populist politicians, greedy capitalists, and conspicuous consumers.

The current issue and full text archive of this journal is available on Emerald Insight at: www.emeraldinsight.com/1753-8394.htm Islamic social business for sustainable development and subjective wellbeing Necati Aydin College of Business, Alfaisal University, Riyadh, Saudi Arabia Abstract Purpose – The purpose of this paper is to report that the social business model has emerged to mitigate the failure of free-market capitalism driven by self-interest in creating social value. It shows how social business contradicts with free-market capitalism while being compatible with Islamic moral economy due to the axiomatic differences between the two economic systems. Design/methodology/approach – Thepaperfollows conceptual,axiomaticandtheoreticalapproachto show how the social business model contradicts with free-market capitalism, but is compatible with Islamic moral economy. The paper provides a theoretical framework for Islamic social business based on an Islamic human and social development perspective. The paper first discusses the failure of free-market capitalism and the emergence of social business in the capitalist system. It then defines Islamic social business and lays out its axiomatic foundation based on the Islamic worldview. It also presents Islamic financial instruments and funds for social business. Finally, it makes a case for sustainable socioeconomic development and subjective well-being within the Islamic development paradigm. Findings – The paper shows that a cosmetic change to capitalism is not sufficient for enabling the social business model to take the main stage in the free-market system. There is a need for a new paradigm of reality, truth, telos andhumannature to support social business. Tawhidi paradigm can be such alternative. Thepapermakesa strong case for social business fromanIslamic worldview. Particularly, certain economic axioms within the Tawhidi anthropology, teleology and axiology provide intrinsic causes for pursuing such business model. The multi-dimensional nature of humans from the Tawhidi anthropology sets the intrinsic foundation for social business. Indeed, although the social business model is new to the West, it has been practiced in certain forms in the Muslim world throughout history. Zakat, sadaqah, and qard hasan can be used to support social business in addition to some Islamic banking instruments. The paper suggests that Muslim countries should embrace the social business model for sustainable development and greater subjective well-being. Research limitations/implications – The paper is purely theoretical. Future studies might shed light on the issue through empirical evidence. Practical implications – The paper is likely to enhance the interest in social business in the Muslim world. The current issue and full text archive of this journal is available on Emerald Insight at: www.emeraldinsight.com/1753-8394.htm Islamic social business for sustainable development and subjective wellbeing Necati Aydin College of Business, Alfaisal University, Riyadh, Saudi Arabia Abstract Purpose – The purpose of this paper is to report that the social business model has emerged to mitigate the failure of free-market capitalism driven by self-interest in creating social value. It shows how social business contradicts with free-market capitalism while being compatible with Islamic moral economy due to the axiomatic differences between the two economic systems. Design/methodology/approach – Thepaperfollows conceptual,axiomaticandtheoreticalapproachto show how the social business model contradicts with free-market capitalism, but is compatible with Islamic moral economy. The paper provides a theoretical framework for Islamic social business based on an Islamic human and social development perspective. The paper first discusses the failure of free-market capitalism and the emergence of social business in the capitalist system. It then defines Islamic social business and lays out its axiomatic foundation based on the Islamic worldview. It also presents Islamic financial instruments and funds for social business. Finally, it makes a case for sustainable socioeconomic development and subjective well-being within the Islamic development paradigm. Findings – The paper shows that a cosmetic change to capitalism is not sufficient for enabling the social business model to take the main stage in the free-market system. There is a need for a new paradigm of reality, truth, telos andhumannature to support social business. Tawhidi paradigm can be such alternative. Thepapermakesa strong case for social business fromanIslamic worldview. Particularly, certain economic axioms within the Tawhidi anthropology, teleology and axiology provide intrinsic causes for pursuing such business model. The multi-dimensional nature of humans from the Tawhidi anthropology sets the intrinsic foundation for social business. Indeed, although the social business model is new to the West, it has been practiced in certain forms in the Muslim world throughout history. Zakat, sadaqah, and qard hasan can be used to support social business in addition to some Islamic banking instruments. The paper suggests that Muslim countries should embrace the social business model for sustainable development and greater subjective well-being. Research limitations/implications – The paper is purely theoretical. Future studies might shed light on the issue through empirical evidence. Practical implications – The paper is likely to enhance the interest in social business in the Muslim world. Social implications – The paper has potential to lead the creation of social value through dissemination of the social business model. Originality/value – The paper contributes the Islamic moral economy doctrine by making a strong case for Islamic social business.

The more recent literature on Islamic economics is largely about Islamic financial instruments and institutions. It might give an impression as if the main difference between conventional and Islamic economics is in the instruments, rather than foundational aspect. Islamic economics is not about the prohibition of certain goods and services. It is a vastly different economic system whose answers to the core economic questions vary significantly. It is important to start from the foundation Islamic economics by redefining assumptions, developing new theories of microeconomics and macroeconomics, and offering testable models from the Islamic paradigm. This paper is an attempt to redefine Islamic economics as a new economic paradigm based on the distinctive axiomatic feature of Islamic worldview. In order to do that, the paper first presents evidences of the crises of capitalism and search for alternative paradigm. Second, it outlines the origin of capitalism within the Western secular worldview. Third, it presents the Islamic worldview from anthropological, epistemological, and teleological perspectives. Fourth, it redefines Islamic economics as alternative economic paradigm

Purpose – This paper aims to compare Pareto optimality for altruistic and individualistic societies to show whether it is possible to have Pareto improvement through altruistic acts even after free market equilibrium. Design/methodology/approach – The paper follows conceptual, axiomatic and theoretical approaches to show Pareto efficiency in altruistic versus individualistic societies. The paper first outlines the welfare axioms of Islamic economics compared to those of capitalism. Second, it defines Pareto efficiency within capitalist and Islamic economic systems. Third, it compares and contrasts the concept in the two systems based on their epistemological and anthropological worldviews. Fourth, it shows how – even under the efficient allocation of material goods – room for Pareto improvement still exists through the redistribution of resources. Finally, it demonstrates optimum income transfer for social welfare maximization. Findings – The paper shows that Islamic economics relying on certain welfare a...

With the depiction of Western lifestyles in various media outlet at the global level, the desire for conspicuous consumption has reached an all time high. Why do people engage in conspicuous consumption? Generally speaking, we could put these motivations under two categories: intrinsic and extrinsic. In this paper, we will examine one of the intrinsic factors behind conspicuous consumption: self-worth. Even though there are some studies exploring the relationship between self-esteem and consumption, this is the first study exploring the relationship between self-worth and consumption. The paper is organized as follows: First, it provides a brief review of how humans lost value since the Enlightenment through the adoption of a secular paradigm in both the modern and post-modern eras. Second, it examines the engagement of conspicuous consumption due to self-worth depletion through commodity fetishism, commodity narcissism, and commodity nihilism. Third, it outlines the Tawhidi paradigm in terms of its ontological, epistemological, anthropological, and teleological worldviews. Fourth, it explores self-worth from the perspective of Tawhidi paradigm. Fifth, it compares secular and the Tawhidi paradigms in terms of their contribution to conspicuous consumption because of self-worth depletion.

Purpose – The purpose of this paper is to offer a new theory of human nature to explain the happiness paradox of capitalism. Design/methodology/approach – It is argued that happiness crisis in capitalism stems from the lack of full understanding of human nature which is like a black box from which key assumptions in capitalist market system are derived. The author attempts to unlock this black box in order to understand the failure of capitalism in bringing happiness. Findings – As the success of capitalism comes from its partial understanding of human nature, its failure comes from its partial misunderstanding or exploitation of human nature. This leads to ignoring the needs and desires of certain elements of human nature for the sake of serving only the animal spirit and self-centric ego. The proposed new theory offers a new understanding of happiness and its determinants. Comparing the human body to a luxury recreational vehicle (RV) and the elements of human nature to the companions on this vehicle, the theory suggests that an individual cannot be truly happy if he or she listens only to one of his/her residents while disregarding the others. The new theory offers better explanation for the 2008 financial crisis and the happiness paradox in wealthy nations. It also provides an underlining framework for the existing happiness theories. Research limitations/implications – The new theory needs to be tested through empirical studies. Social implications – The paper theoretically argues that that authentic happiness is possible if individuals listen to the voices of all elements of human nature and try to fulfil their needs and desires in a balanced manner. Originality/value – The paper offers a new comprehensive theory on human nature. Keywords Capitalism, Consumerism, Human nature, Happiness, Subjective well-being, Hedonism

Both success and failure of free market economy could be explained$\backslash$nthrough its understanding of human nature. Its great success in$\backslash$nproduction comes from its principles based on ``self-interested{\{}''{\}}$\backslash$nhuman nature driven by animal souls and egoistic desires. The system$\backslash$nachieves higher productivity by providing many incentives to motivate$\backslash$npeople whose goals are to maximize their interests. On the other hand,$\backslash$nthe failure of the free market system comes from its lack of moral$\backslash$nprinciples to balance irrational and irresponsible decisions/behaviors$\backslash$nof animal souls and ego. For that matter, the paper argues that the 2008$\backslash$ncrisis was essentially a moral crisis of capitalism with its root going$\backslash$nback as far as the Enlightenment. It suggests that during the crisis,$\backslash$nthe ``invisible hand{\{}''{\}} of free market turned to ``stealing hand{\{}''{\}}$\backslash$nthrough market games driven by the irrational and irresponsible$\backslash$nbehaviors of politicians, creditors, and consumers. The paper concludes$\backslash$nwith few lessons learned from the crisis. First, the crisis created a$\backslash$ngreat opportunity to acknowledge the need for moral values for efficient$\backslash$nmarket system. Second, we should revise our assumptions of human nature$\backslash$nand behaviors in economics and finance to include predictably irrational$\backslash$ndecisions of individuals. Third, we should include moral education in$\backslash$neducation system at K-12 levels, not at the college. Finally, we should$\backslash$nrevise our economic models to capture the importance of moral and$\backslash$nspiritual capital as endogenous variables.

This paper attempts to show that sustainable consumption depends on individual’s pursuit of subjective well-being or happiness. Under the influence of global consumer culture, people believe that the more they consume the happier they will be. Therefore, they keep spending more for greater expected pleasure. Paradoxically, with more and more consumption, people are achieving same or less happiness. This is neither desirable nor sustainable. Therefore, there is an urgent need to examine and modify the current hedonic happiness model, which is based on always more consumption, in order to achieve more happiness while reducing consumption to sustainable levels. This paper is an attempt to examine the relationship between current conspicuous consumption and the hedonic happiness model promoted by the global consumer culture. The paper offers an alternative happiness path compatible with human nature resulting in less and sustainable consumption that will increase both psychological and ecological well-being.

The objective of this paper is to measure the impact of public postsecondary centers and institutes (C{&}Is) on the employment and economic output on Florida's economy. We use the Florida REMI model to forecast both direct and indirect economic impacts over multiple-year time frames. Our findings indicate that C{&}Is contribute significantly to the Florida economy. These economic benefits extend to job creation; generation of GRP, personal income and state taxes.