Concept of Scarcity in the Islamic Economic Perspective
Hanif Fadhlillah, Muhammad Nafik, Ririn Ratnasari, Tika Widiastuti
1
and Sri Herianingrum
Postgraduate School Universitas Airlangga, Airlangga Street 4-6, 60286, Surabaya, Indonesia
Keywords: Scarcity, Distribution, Consumption, Islamic Economic
Abstract: The scarcity of goods and services is seen as a fundamental problem in the economy, as in the conventional
economic view. People are required to increase production to cover the scarcity of goods and services. Islam
holds the view that the concept of scarcity in conventional economics does not exist because everything
created in this world is destined for humans. In the absence of the concept of scarcity in Islam, the economic
problem does not lie in the way of overcoming scarcity, but the way of distribution and consumption of
wealth or wealth in society. It is this distribution and consumption that is the main problem in the economy,
not the production problem to overcome scarcity. The solution to the problem of scarcity is how to
distribute a fair and equitable wealth and consumption in the middle.
1 INTRODUCTION
Economics is an activity that aims to fulfill all the
needs and wants of humans. To be able to maintain
life, humans need food, drink, clothing and
protection or in other words primary, secondary and
tertiary needs. So as to fulfill all these needs and
desires, each individual must carry out economic
activities including production, distribution and
consumption. But in fulfilling all these needs and
desires, they are often faced with an economic
problem, namely scarcity. This is based on the
behavior of each individual who is never satisfied in
the process of meeting needs and desires, starting
from the production process, especially in the
process of distribution and consumption.
Scarcity is closely related to the process of
distribution and consumption. On the one hand,
every human being always has a desire to consume
that is relatively unlimited in enjoying sharing the
types of goods and services that can meet various
needs. On the other hand, the resources or factors of
production that can be used to produce goods and
services are relatively limited. Because human needs
are not limited while the means of satisfying needs
(goods and services) are limited, there is a scarcity
of means of satisfying needs.
Scarcity is an unlimited problem of the needs and
desires of people in the world with limited resources,
which means that society never has enough
productive resources to meet all the wants and needs
of its members, or that not all desires and needs can
be fulfilled at the same time so a trade off is made
from one item against another and the country must
decide what goods and services to buy and which
ones to forget. Malthus (1798) states that food
supply tends to increase arithmetically while the
human population increases geometrically. Malthus's
ideas emerged during the European Enlightenment
period which explained the birth of secularism.
Malthus's appropriate ideological framework tends
to leave out religion from its understanding of
economic behavior and policy.
For Sadono (2004) scarcity or shortage applies as
a result of an imbalance between the needs of
society and the factors of production that are
available in society or provided by nature. On the
one hand, in every community there is always a
relatively unlimited desire to enjoy all types of
goods and services that can meet their needs. On the
other hand, the resources or factors of production
that can be used to produce these goods are
relatively limited. Therefore the community cannot
obtain and enjoy all the items they need or want.
They need to make choices.
Dwi Condro (2011) states the scientists’
conventional view that humans and society always
had a desire to be as a necessity, either in the form of
goods or services. In order to meet these needs, the
next will be called a problem which will then be
Fadhillah, H., Nafik, M., Ratnasari, R., Widiastuti, T. and Herianingrum, S.
Concept of Scarcity in the Islamic Economic Perspective.
DOI: 10.5220/0007538100930096
In Proceedings of the 2nd International Conference Postgraduate School (ICPS 2018), pages 93-96
ISBN: 978-989-758-348-3
Copyright
c
 2018 by SCITEPRESS – Science and Technology Publications, Lda. All rights reserved
93

considered as the most fundamental problem in the
economy, namely the limited means of fulfilling
human needs provided by nature. This view of the
problem of scarcity is further strengthened by the
fact that human and community needs for goods and
services are apparently unlimited. This means that
economic scientists see that human needs if they
have to be honestly disclosed, will never be endless.
Apart from unlimited human needs while the means
of satisfying human needs are limited, scarcity is
also caused by human growth which is quite large,
while production of goods is slow because the
factors of production of natural resources are fixed.
Milton H. Spencer (1977) ststea that capitalism is
an economic system characterized by the
organization of private property (individual) on the
means of production and distribution (land,
factories, rail roads, etc.) and their utilization to
achieve earnings in very competitive conditions.
Whereas according to Brinton (1981) socialism can
be interpreted as a form of economy in which the
government at least acts as a party trusted by all
citizens. In its most complete form socialism
involves ownership by the state of all means of
production, including agricultural lands, and
eliminating private property. In socialist societies the
most striking thing is collectivism or a sense of
community. To realize this sense of togetherness, the
allocation of production and the method of
distribution of all economic resources is regulated by
the state.
The concept of Islamic economics is different
from the economic concept of capitalism, which
does not regulate the quantity and quality of the
acquisition of assets and their utilization and is
oriented towards individualism without regard to the
interests of others. It is also different from the
economic concept of socialism which regulates both
the quantity and quality of assets centered on the
government. In Islam, there is no freedom of
ownership, but there is no absolute limitation. Islam
regulates the method, not the amount of ownership
and the way in which ownership is used. The
principle in the Islamic system is a fair balance that
clearly shows respect for the rights of individuals
and society.
Islamic economics provides the basic principle of
the distribution of wealth and income so that wealth
is not only circulated among the rich. Islam regulates
wealth and income distribution for all citizens, not
just commodities for the rich. In addition, in order to
realize the way of justice, Islam emphasizes the
importance of wealth circulating in society through
the payment of zakat and infaq, inheritance rules,
wills and grants. Good distribution of wealth will
eliminate all socio-economic problems resulting
from social and economic inequalities including
scarcity. There will be no domination over each
other, and each individual will be treated equally and
will have many opportunities to be like others.
For Chaudry (2012), the basis of Islam aims to
realize happiness (falah) in the world and the
hereafter, and to realize brotherhood among the
people. This goal cannot be achieved if the
distribution of wealth among the community takes
place unfairly, the gap between rich and poor is too
wide and conflicts between classes occur in society.
If the property is sufficient to satisfy one desire then
another desire will arise and thus life will be filled
with the struggle to fill the endless chain of desire.
Such is the desire and fulfillment and it then
becomes a stake in the struggle of the human
economy.
2 ANALYSIS OF THE CONCEPT
OF SCARCITY IN ISLAMIC
ECONOMICS
Amir Ahmed (2010) stated that historically, the
concept of scarcity has dominated the economy
since the mid-twentieth century. Malthus sees
scarcity in its absolute sense, while Robbins sees it
in a relative sense. The concept of scarcity develops
in an era of rising secularism, which excludes the
role of religion in human affairs.
For Baqir Ash Shadr (2008) the problem of
Islamic economics is not caused by the scarcity of
material resources or means of satisfying the needs
or limited natural resources. It is true that the source
of production is limited, while human needs are very
numerous and varied. But that does not mean that
the economic problems faced by humans arise from
the effects of unlimited human needs.
If all economists consider that scarcity is the
main problem faced by humans on earth, the
solution they provide is to improve the quality and
quantity of production. This will cause a massive
increase in production by a country in the macro
economy and a lack of concentration on the
distribution of crops. The most common assumption
is that the welfare of a country is determined by an
increase in the production of goods and services as a
means to satisfy the needs of society. Lack of
concentration on the distribution of wealth will lead
to a monopoly of ownership. People who have large
capital will gain a lot of wealth or property, whereas
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people who have less capital will get a little wealth
or property. That way it will create a wealthier
community that will get richer and the poor will get
poorer.
Islamic economics directs the mechanism of
spiritual-based income distribution in the
maintenance of social justice in every economic
activity. This is due to an imbalance in the
distribution of wealth into something that underlies
almost all individual and social conflicts. Efforts to
achieve human happiness, guide people to apply
economic justice that can stop misery on earth. This
will be difficult to achieve without confidence in
moral principles and discipline in applying moral
concepts.
The Islamic economic system is able to benefit
all societies because it sees economic problems not
from a capitalist point of view that gives individuals
freedom and ownership rights and promotes
individual efforts, or from a socialist point of view
that wants to eliminate all individual rights and
make them like economic slaves controlled by the
state.
For Qardhawi (1997) income distribution in
Islamic economics is based on two very basic and
important human values: the value of freedom and
the value of justice. This opinion is based on the fact
that God as the absolute owner of wealth has given
the mandate to humans to regulate and manage
wealth with the authority to have wealth. Islamic-
based economic systems suggest that in terms of
distribution it must be based on two joints, namely
the joint of freedom and justice of ownership.
Freedom here is freedom in acting in the frame by
religious values and justice unlike capitalist
understanding which states it as an act of freeing
people to act and act without any party interference,
but as a balance between individuals and their
material and spiritual elements, the balance between
individuals and society and between a society and
other communities. Justice in the distribution is
reflected in the prohibition in the Koran so that
property is not allowed to become a commodity that
is only circulated among rich people, but is expected
to contribute to the welfare of society as a whole.
The Islamic program in prosperity redistribution
consists of three parts:
First, as explained earlier, Islamic teachings
include providing assistance to unemployed and job
seekers so they can get good jobs, and giving fair
wages to those who work. Second, Islam emphasizes
the payment of zakat for the redistribution of income
from the rich to the poor, who because of inability or
personal obstacles (physical or mental conditions
that are external, such as lack of employment) are
not able to achieve a respectable level of living.
Third, the division of inheritance of land/garden
from someone who dies, in accordance with a
predetermined standard among a number of
individuals to intensify and accelerate the
distribution of wealth in the community.
However, the concept of Islamic justice in the
distribution of income and wealth and its conception
of economic justice does not mean demanding that
all people receive the same wages, regardless of
their contribution to society.
Islam tolerates income inequality to a certain
degree, because everyone is not the same in nature,
ability and service to society.
Therefore, distributive justice in Islamic
societies, after guaranteeing a humane level of living
to all its citizens through institutionalization of
zakat, permits income differences that correspond to
the difference in the value of contributions or
services provided, each person receives income
commensurate with the social value of the service he
gave to the community.
Islamic consumption behavior is different from
conventional consumption. Islamic consumption will
always pay attention to maslahat as the main goal in
Islam which leads to the protection of religion, soul,
mind, descent and wealth. In Islamic ethics, desire
must be limited because human desire will not have
limits if it is not limited, while its needs must be
met. Every person must personally struggle, work
and be responsible for meeting their needs,
especially their basic needs. If they are not capable,
the state through the leader must be responsible for
meeting their needs. This obligation is to meet
human needs, and not desires. The standard needs of
every human being have the same criteria in Islam
which are summarized in the maqasid al-syar'iyyah.
The balance of consumption in Islamic
economics is based on fairness of distribution.
Consumption justice is where a consumer spends his
income on material needs and social needs. Material
needs are used for the individual life of individuals
and families. Social consumption is used for later
life in the form of zakat, infaq, and shadaqah.
The Islamic Economic System, if fully
implemented, can prevent excessive accumulation of
wealth and also ensure equal distribution of income.
The key variable of this system is ushr/zakat. There
is a visible dampening effect on zakat on
accumulation of wealth in addition to reducing
income inequality. Eliminating interests is also very
important to reduce inequality in income
distribution. In addition, detailed inheritance laws
Concept of Scarcity in the Islamic Economic Perspective
95

distribute the wealth collected by a person and
ensure that wealth is not concentrated in several
hands. When all these elements are not put together
and implemented as a whole, the expected impact on
the distribution of income and wealth will not be
realized.
3 CONCLUSIONS
The Islamic economic system does not perceive the
scarcity of goods or services as due to the limited
natural resources available on this earth. For Allah
has created all the earth and its contents for man in
the face of his life in the world. Allah created the
earth and the heavens and what is between them for
man. So, it should not be a human, especially a
Muslim, that this nature provides limited natural
resources or needs for. The main problem in the
Islamic economic system does not lie in production
activities to meet the scarcity of goods and services,
but lies in the way of distribution of property or
wealth either in the form of goods or services in the
middle of society.
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