Capitalism and the Struggle for an Islamic Economic Ethics in Contemporary Indonesia

• In Event: Muslim Moralities in Asian Capitalisms - Sponsored by the South Asian Muslim Studies Association (SAMSA)

Abstract

Muslim Indonesians have a long history of participation in market-based economies. Muslim merchants were at the forefront of the region’s great “Age of Commerce” from the fifteenth to eighteenth centuries. In the twentieth century, and in the face of Western colonial and post-colonial capitalism, many Indonesian Muslims rallied to the ethical ideals of Islamic socialism. From the 1990s onward, with Indonesia’s rise to prominence as a regional economic power, most Muslim thinkers put aside Islamic socialism and subscribed to some variety of market-based development. But most have done so while still insisting that Muslim capitalism differs ethically from that of the liberal capitalist West.
In this paper I compare three examples of contemporary Indonesian Muslim ethical engagements with the challenges and opportunities of capitalist development. The examples are drawn from the fields of Islamic banking, Islamic management, and market-oriented religious charities. All three fields have given rise to an extensive and highly “discursivized” body of ethical commentary on Islam and economics. But the core values affirmed in each field, and the features identified as distinguishing Islamic from “Western” capitalism, differ significantly. The differences indicate that Muslim Indonesians, like Muslims in the broader world, have yet to reach a settled consensus on capitalism and Islamic ethics. But the differences also bear witness to the fact that, rather than ushering in an “end to history,” capitalist globalization has generated a world-wide moral debate on the place of economics in modern ethical flourishing.

Author

• Robert W. Hefner, Boston University