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Published in: Asian Journal of Business Ethics 1/2018

18-04-2017

Moral economic axioms, preference formation and welfare in Islamic economics and business

Author: Necati Aydin

Published in: Asian Journal of Business Ethics | Issue 1/2018

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Abstract

Consumers and producers aim to maximize their welfare through economic transactions. Their welfare is determined by choices and preferences. Therefore, understanding social and economic welfare projected by conventional and Islamic economics requires exploring their underlying paradigms and axioms for preference formation, choices, and welfare maximization. Even though conventional economics assumes that preferences are given, it actually considers that they are driven by self-interest. It does not discuss preference formation along determining moral axioms. Rather, it starts from revealed preferences to understand choices of consumers and producers. Thus, preference formation is like a black box. This paper is an attempt to unlock this black box by exploring preference formation along its underlying moral axioms for good life. The paper discusses Islamic moral ideals within the Islamic worldview along the implications of those axioms for consumers, employees, and employers. The paper also explores the gap between those ideals and Muslim reality. It suggests how to empirically test the relationship between moral axioms and ethical behaviors of consumers, employers, and employees. It concludes that internalizing moral axioms would serve as an ethical compass necessary to establish formal and informal institutions for efficient and ethical business organizations.
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Metadata
Title
Moral economic axioms, preference formation and welfare in Islamic economics and business
Author
Necati Aydin
Publication date
18-04-2017
Publisher
Springer Netherlands
Published in
Asian Journal of Business Ethics / Issue 1/2018
Print ISSN: 2210-6723
Electronic ISSN: 2210-6731
DOI
https://doi.org/10.1007/s13520-017-0077-7

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