Comparison between Capitalism Socialism and Islamic Economics

Capitalism is the kind of economic system in which resources, be they monetary or otherwise are owned privately. Socialism is a system through which good are either public or state owned. Islamic economics is based on the reorganization of the economic system to ensure that all individuals enjoy quality rights and they are treated fairly regardless of the resources available

Capitalism economics is based on the belief competition will bring out the best in people, socialism believes cooperation if the key for people to live in harmony and co-exist while Islamic economics is about welfare achievement of all human beings and not dealing in self interest.

Because of the conditions that exist in today’s world, many people regard Islamic economics as some kind of ‘capitalism’. However, this is far from the truth. Islam is actually a class on its own and it is likened to modern ideologies, it is the same as socialism.

Differences between these economic systems

The main different between these economics is how wealth is earned and distributed. In capitalism, everyone is supposed to work towards earning their own wealth while in socialism and Islamic economics they work for wealth which is distributed to everyone equally. The main drive in capitalism economics is that a group of individuals or an individual owns resources. For instance if a business is run by an individual or group of individuals, then resources are traded by the decisions they make only.

The role of the government is ensuring that all individuals get a playing field that is leveled through introduction of laws. However, in the capitalist economy, the government is not allowed to interfere with the dealings of the individual except in ensuring the laws are followed.

In capitalist economies, everyone also owns their own labor and it can be sold at a fee to employers. What this means is that people are free to get jobs then decide what the cost of their labor is going to be in terms of wages. If the employer feels the wage is too high and does not match up to the worker’s qualification, they can decide not to hire them and instead choose someone else. Consequently, in capitalist economies, work is a matter of demand and supply.

Under socialism and Islamic economics though, resources are owned by all people and this means they all get to say how they should be used. Everyone aims to work for the good of others and people are able to get what they require when they need it. Socialism believes that capitalism favors the rich unfairly leading to concentration of power and resources to a few while the rest suffer.

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