Despite the geographic and cultural diversity of Muslim societies, Muslim countries remain significantly lagging behind in the industrialization race. Nearly 500 years ago, Europe surged ahead in industrialization and economic prosperity, while the Middle East witnessed a recurrent decline in economic fortunes. Dr. Adeel Malik, Globe Fellow in the Economics of Muslim Societies at the Oxford Centre for Islamic Studies, presented a study discussing why the Middle East failed to develop in relation to Europe. He investigates the divergence in development outcomes by relating this decline to the provisions of Islamic law and how they led to the underdevelopment of the private sector.
Malik argues that the law per se is only one part of the institutional framework; the enforcement and political structure are also important factors to take into consideration when assessing development. The study shows how Islamic law influenced the politics of the Middle East, exploring the underpinnings of religious authorities dating back to the Ottoman era. Religious provisions were incorporated in the bureaucratic structures and deeply impacted many economic as well as political decisions. For example, laws in the Ottoman period limited capital accumulation thus holding back private sector development.
On the other hand, Malik studies the rise of the west. He argues that European economic advantage was the product of several reinforcing factors, such as trade, political competition, geography, overseas conquests… etc. Thus to reduce the divergence between the Middle East and Europe is an over-simplification.
In conclusion, Malik argues that Islamic law has not been the only binding constraint to development. But was the relative economic decline of the Middle East a legal or political failure? He argues that Islamic provisions do have the capacity to conduct innovation and change, thus the lack of both must reflect a shortcoming on the institutional framework’s part.
Watch Malik’s interview