Middle east economy Essay Example | Topics and Well Written Essays - 1250 words

Middle east economy - Essay Example On economic issues, there has been a traditional shaping of the way the economies are run largely by the common religion that the region shares. The political stability of the region has also not been stable owing to the many Islamist groups that have constantly fought for islamisation of all policies in the region according to the rules of the Quran. This region has not developed well relative to the world level of emerging markets (Kuran). This paper therefore seeks to establish the historical facts that have led to this underdevelopment since the development of the Islamic law and the Quran. The economic institutions that existed in pre-modern times were of the idea that all laws are to be implemented under duress. The major focus will be on historical institutions that that accounted for the subsequent institutional evolution in the region. Economic Institutions The growth of economy in the Middle East draws its historical background to the development of Islam. This brought in t he economic institutions based on advanced contract law. The Islamic law brought in principles, regulations and procedures that governed the development of the economy of this region. ... However, economic scholars of the time were not able to agree on the definition of ‘lending’ or what really constituted ‘interest’. Islam jurists supported the credit money in which there was devising strategies that allowed interest to be charged without violating the Quran principles. There were no financial institutions and therefore the lenders were just individuals and society groups. The third issue shaping the economic governance of the region was economic governance that was shallow. Most of the governance was made by the state in which case mosques, libraries and caravanserais were built and financed directly by the state. These, being Muslim states were built on the basis of two very basic principles; Provisionalism as well as Fiscalism. Any order that was contrary to these principles was not directly allowed and did not therefore get the support of the national government. Weak property rights as well as arbitrary succession were the order of the day which was reported during the early practices of economy. The Muslim statesmen in the region starting with those in the state of Saudi Arabia had tax policies that were very concrete. The same was soon spread to other areas of the missile east that had embraced civilization earlier on especially the pre-Islamic civilization. These laws however became obsolete especially in Iraq, Syria, Iran and Palestine. Therefore, just like in civilizations that were coeval, there was tax discrimination in that the non-Muslims paid more taxes than the non-Muslims. This principle was unsystematic and many more communities received expropriation. However, as the practice became more applicable, there was the extent of confiscation and imposition of new taxes in the economies. This means that this industry