CIBS Conference: Reading 2007
Abstract
Gulf Business Model: Other Invisible Hands
In the “Ihya Ulum al-Din” Abu Hamid Ibn Al-Ghazali previewed the natural spontaneous order
of economy which some seven hundred years later, Adam Smith was to capture for western
economists with the phrase “the invisible hand.” Ghazali’s 12th century analysis of the division
of labor leading to specialization in some 25 different processes needed to make a needle also
previewed the 10 man multi-process production process in Smith’s famous pin-factory.
Ghazali also wrote at length on the institution of Hisbah. Hisbah might best be described as an
early form of security exchange commission with its principal function of identifying improper
market interference and unethical practices such as fraud and usury.
Of particular interest is Ghazali’s writing in Kitab Nasihat al Muluk on the special role of
government in an economy. Ghazali quite rightly sees no necessary linkage between the
division of labor and the concept of equilibrium. In Kitab Ghazali warns rulers of “the abuse of
authority, pride, surrender to flattery, and deceitful religious scholars.”
This paper first notes reasons why the division of labor, the invisible hand, ought not to be
linked with the notion of market equilibrium. In the process the reader will note how the
counsel Al Ghazali gave to the rulers of states has too often been ignored in western economies.
The paper then continues to identify how, in the Gulf, too often “the principles of justice and
equitable treatment” which should operate in an open market have been corrupted and so have
not prioritized individual and social needs.
The paper identifies specific examples of the (albeit innocent) abuse of authority by
government in the Gulf which have corrupted the market and most particularly how the abuse
of government threatens the social security of the Gulf’s youngest citizens.
Key Words:
Dead capital, Market Mechanism, Competition, Division of Labor
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Gulf Business Model: Other Invisible Hands
“All that is best in the Arabs has come to them from the desert: their deep religious instinct,
which has found expression in Islam; their sense of fellowship, which binds them as members of
one faith; their pride of race; their generosity and sense of hospitality their dignity and the
regard which they have for the dignity of others as fellow human beings; their humour, the
courage and patience, the language which they speak and their passionate love of poetry. But
the Arabs are a race which produces its best only under conditions of extreme hardship and
deteriorates progressively as living conditions become easier. It seemed to me tragic that they
should become, as the result of circumstances beyond their control, a parasitic proletariat
squatting about oil-fields.”1
Wilfred Thesiger “Arabian Sands”
Until recently the “considerable influence of Arab scholars on economic thought”2 translated to
the language of the marketplace rather than into scholarly texts. As with Algebra (al jabwra)3
and algorithms, bills of exchange (suftajah), letters of credit (hawala); money exchange centers
(funduq); private banks (ma’una) and the cheque (sakk)4 translated easily to the western world
of commerce. Meanwhile western economic writers concluded that there was a gap in the
development of economic thought between the Greeks and St Augustine. Schumpeter wrote
“we may safely leap over 500 years to the epoch of St Augustine”5 somehow ignorant of the
significance of practical events and the observers of those events taking place in our European
marketplaces. Yet the existence of a gap between activity in the market and academic writing
is no surprise to those of us who implemented and computerized activity-based costing a
decade or two before aactivity-based costing was first included in the modern university
accounting curriculum.6
No such gap ever actually existed. Concise observations were made by many Medieval Islamic
Scholars7 writing about marketplace activity in medieval Syria, Palestine, Arabia, Iraq, and
Egypt. These observations from within Arab culture and civilization are often ignored and,
regrettably, appear to fall outside the curriculum of present day Arab secondary and tertiary
education.8 These examples provide context and contrast for the “discipline, knowledge,
achievement, scientific inquiry, and pluralism”9 still to be found in the Gulf marketplace.
When studying present day business models in the gulf, the works of medieval Islamic scholars
seem to provide a better benchmark against which to measure the modern lack of
representations10, described by de Soto, which appear to explain why we find to so much “dead
capital”11 in the Gulf.
This objective of this paper is to consider selected market benchmarks and, in the process, to
try and explain why the business model in the Gulf differs so significantly from western
business models. In the process significant contrasts between the Islamic economic scholars
and the Western economic scholars appear. The impact of these contrasts may be seen to
provide evidence of an integral relationship between historical perspective and present day
activity..
The Market: Market Mechanism:
For Ghazali the 11th century market for goods and services is determined by the motivation of
the participants. “As the farmer needs blacksmiths and carpenters and they in turn need
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farmers, so each will want to satisfy his needs by giving up a portion of what he possesses.” 12
For Smith a similar motivation is seen in the 18th century market as “every individual
endeavours to employ his capital as near home as he can”13 While Smith identifies the social
motivation of security and maximization of the value of individual human capital as the
unintentional product of “the invisible hand”14, Ghazali sees similar social obligation but
perhaps with more hierarchical purpose in social obligation first “to produce necessities for
society’s needs”15 and then profitable endeavors guided by the idea of “profits’ in the
“ultimate”16 market, that is the hereafter.
Ghazali’s 11th century analysis of the division of labor leading to specialization in some 25
different processes needed to make a needle17 previews Smith’s analysis of “the trade of the
pin-maker”18 where 10 men employing multi-process production manufacture thousands of
pins a day. Ghazali is conscious of the competitive environment, especially since the skills of
the 11th century were less mechanical to those needed by the 18th century. To this end he writes
of the need for a “balance” which can be maintained “by the exercise of authority and
maintenance of justice.”19 Smith also wrote of competition, how “candidates for fortune too
frequently abandon the paths of virtue” 20
Both Ghazali and Smith believe that buyers and sellers in the marketplace have “a moral sense,
just as they have inborn ideas of beauty or harmony”21. This moral sense can facilitate market
operations which are beneficial and orderly. While Smith does not immediately identify this
sense within his analysis of the market, Ghazali incorporates the idea of market regulation to
prevent “tendencies like jealousy, competition, and selfishness” which “can create conflicts.” 22
To ensure market stability Ghazali writes of the use of and need for the institution of the
Hisbah23. The term Hisbah as use in the 11th century (and earlier24) may be loosely translated
as market supervision and though the institution covered much more than the conduct of the
traders, craftsmen, artisans and laborers in the market place we might in the 21st century see the
Hisbah as an early form of security exchange commission with principal functions to identify
improper market interference and unethical practices such as fraud and usury.
The markets of the 11th and 18th centuries thus share a fundamentally similar and simple
explanation for activity within the market, with this intriguing exception the need for the
Hisbah and therefore early reference to the principles of transparency, and accountability
“strongly debated topics in discussions of economic policy over the last decade.”25
The same emphasis on the need for market regulation can be found in the writings of Ibn
Taimiyah in his book on the institution of the Hisbah,26 in the works of his student Ibn
Qayyim,27 in the Muqaddimah 28 and many other medieval Muslim writers.
The Market: Competition and the lack of representations:
“In contrast to their European counterparts”29 the medieval economist encouraged people to
accumulate wealth and employ their talents. Ibn Khaldun wrote, for example, that profit
“comes to those who work and produce things by their labor” and noted that as “the available
labor increases, in turn luxury again increases in correspondence with the increasing profit.”30
Ghazali and other medieval Islamic Scholars31 share with Smith and current economists the
need for individual activity in the market place to generate the exchange of the produce of
human capital (labor) “which originally supplies it (the market) with all the necessaries
and conveniences of life” and “which consist always either in the immediate produce of
that labor, or in what is purchased with that produce from other nations.”32 As Ibn
Khaldun writes “Labor is the real basis of profit.”33
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The medieval economists did not get to observe exploitation of today’s’ valuable carbon natural
resources. Clearly the opportunity to attract labor to exploit oil would fall in line with
spreading wealth to avoid poverty in the immediate term. Yet the medieval scholars emphasis
on family34 would appear to reject the idea of the actually abdicating the exercise of labor and
exploiting foreign rather than domestic talent. As with the comment of Smith that people
prefer to work at home to be near their family35 so much of the purpose of competition is, at
least initially, to provide for the family unit and the immediately surrounding local group.
This notion of the need to employ an individual’s labor first for immediate family and then for
the group provides an interesting contrast between the competition involving people in “cities,”
similar to people who live in the urban economies of the West, and the people “who settle in
the desert.” Ibn Khaldun makes this distinction which he writes “should be understood and the
proper conclusions be drawn from it.”36
The group feeling Ibn Khaldun identifies is based on an individual’s awareness of common
descent, not just of descent from a common family, but descent within the parameters of a
relatively small common group. While citizens in towns rely on the specialized services of
government to provide protection and defense, those who live in the desert lack these urban
resources and become more reliant on each other. This reliance is not a simple tribal
association, not a simple family group, but a complex interrelation of differing levels of mutual
obligation and service. This influence has been described as the "key to understanding
decisions in the Middle East, for wasta pervades the culture of all Arab countries and is a force
in every significant decision. . . . Wasta is a way of life."37 Recently Bader Al-Saleh wrote that
“the practice of wasta is very common, it still continues like an age old tradition in every aspect
of lfe."38 Wasta represents the cards you hold in a game of favors39 which are gained or which
you are obligated to provide. Wasta appears to originate in the culture of the dessert where 40.
Everyone has some wasta, but the cards you hold are subject to wild (power) cards, depending
on your relationship with your family, tribe, employer, social group and many complex
combinations of any situation. What was an important force for benevolence in the dessert is
often significantly less benevolent and even counter benevolent in the structure of the modern
urban environment.
The impact of wasta may explain several of the mysteries of how the creation of capital, to
which de Sotto refers,41 and even provide the vision necessary for capital creation, instead of
natural resource exploitation. Indeed there is some irony in the idea that Western nations “have
lost the memory of how it (creation of capital) was done”42 while many Eastern nations,
particularly many in the Gulf, are seeking to rediscover this mystery. A brief examination of
three of these mysteries, missing information, capital flight, and political awareness offers an
opportunity to recognize the significance of dead capital in the Gulf.
Missing Information:
In the Gulf proper documentation detailing the existing capacity for accumulation of capital is
largely absent. The absence of a tax system and the lack of transparency, accountability, and
disclosure of income and asset volumes43 limit determination of the potential for development.
Available data44 indicates billions of dollars of annual capital outflows45 accumulate outside the
Gulf area. This capital flight46 reflects government and individual national investments outside
the Gulf and includes a significant portion of expat remittances. From a Gulf point of view this
represents, at least on a national level, “dead” capital, that is to say “wealth that has been
accumulated (but) cannot be used to secure loans”47 and thus the reason why the capital fails to
initiate job creation and sustainable wealth generation in the Gulf.
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This capital provides an opportunity to bridge the growing reality gap between Rostow’s
“Take-off” and the “Mass Consumption” stages of growth48 in the Gulf. This gap is readily
seen in the presence of a highly developed market for first world consumer goods and a
significantly underdeveloped third world approach to the development of sustainable
productive industry. To cross this gap two elements are required. First a build-up of capital is
needed. This must be accompanied by “the emergence to political power of a group prepared
to regard the modernization of the economy as serious, nigh-order political business.”49
Capital Flight
In spite of overall capital flight from the Gulf, there are rare examples of investment in
sustainable job generating productive industry. Consideration is rumored to be being given to
an assembly plant for Daimler Chrysler vehicles in Dubai50 Interest has been expressed in
developing health care facilities and fostering medical research51. Interest has also been
expressed in developing upstream oil sector refining facilities to separate out bunker oil so as to
increase the market value of light sweet crude52. But to date the only practical solution to
sustainable job development in the Gulf has to a great extent involved the guarantee of
employment to Gulf citizens in non-productive employment so that many have become, albeit
unintentionally, as Thesiger wrote “a parasitic proletariat.” Add Ibn Khaldun53
The extent to which “employment” in the Gulf has replaced the Western “welfare” systems is
not difficult to determine. Supernumerary employment in the oil industry, for example, can be
determined by making comparisons between the audited Gross Margin of government owned
National Oil Companies in the Gulf and the audited Gross Margin of International oil
companies since the price of oil shared is the world price. The difference in gross margin
percentage may exceed 15%, and this loss of margin directly reflects the “welfare” nature of
the employment. Further the funding of research and development by nationals of government
owned national oil companies in the Gulf appears to be limited and the absence of preventative
maintenance is frequently seen to be the cause of “repeated accidents”54 at refineries and
gathering stations. Yet “the importance of research and technology in the future should
not be underestimated, especially when we look at the diverse nature of challenges the
industry faces in ensuring value creation from activities.”55 Recently the State of Qatar
invited OPEC to set up a research center in Doha, recognizing the opportunity to
generate future jobs for educated Qatari graduates.56 Other sustainable employment
opportunities in the Gulf need investment and thereby a serious expression of
confidence in the future of this region.
Similar differences may also be found in numbers employed in Ministries (and the number of
Ministries) and public sector industry. These highlight the current application of dead capital.
Political Awareness:
The “Lack of clear vision”57 is often linked to the ups and downs in the Gulf stock markets.
Rumor is frequently a more important inspiration for transactions than relevant and reliable
knowledge. Al Humaidhi58
Delays and in the awarding of contracts59 and post award review of BOT (Build Operate and
Transfer) and other contracts underline the unattractive uncertainty in the development of
sustainable job generating activity. Legislators, often unfamiliar with the global norms for
business contracts, inevitably focus on the short-term seeking for the budget surplus to be
employed in the forgiveness of voter debts, including utility bills and loans for luxury spending.
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Meantime limited research is done to gain awareness of the long-term consequences of the
employment of dead capital. Even investment in real estate is not sufficiently regulated to
provide for a future with essentially national employees working in construction (instead of
providing many sustainable jobs for expats).
One approach taken in the Gulf is to introduce legislation “aimed at increasing the proportion
of nationals employed in the private sector”60 The policy has met with great success in Oman
and the poorer Gulf countries. The policy certainly has contributed to a higher proportion of
nationals joining the private sector in recent years. However while the “welfare entitlement”
programs continue to provide nationals with enough minimum household income to place them
among the world richest 10%61 the risk to be taken by entering the private sector is likely only
to be taken by those with sufficient education to be employed in the private sector at a higher
than “entitlement” wage. As identified later in this paper, significant changes will also need to
be made to these programs, especially to ensure fully funded pension programs.
The relative absence of political awareness of the unsustainable nature of the present Gulf
economies links in with the absence of projections of future cash flows, with the outflow of
capital, and the apparent lack of political determination to make the changes necessary.
The Market: Motivation:
"Motivation is the characteristic of some people having enough interest to employ their capital.
It is not the characteristic of there not being enough capital to be employed”62
The motivation for the provision of a sustainable future economy is identified by the medieval
Islamic Scholars. The motivation includes seasonal taking in the harvest for food for the
following year, saving for the education of children and the provision of resources for old age.
Ghazali is clear on this point when he writes “man has high aspirations. He always thinks that
the wealth which is enough now may not last, or might get ruined and then he would need
more. He tries to overcome these fears by further accumulation. But such fears do not end –
even if he has all the possessions of the world.”63
And yet these “fears” have been overcome by the generosity of the “welfare / entitlement”
system. Nationals guaranteed employment which requires little effort and produces little or
nothing and encourages reliance on the work of expats have little or nothing to fear. Their
focus, particularly if they are young, will be on the ever present. Unlike generations who
remember the depression, they come from a generation who has only known plenty. The need
for education is often seen only as an opportunity to gain the necessary credentials which will
gain additional scholarship (for many abroad) allowances and, after graduation, higher places
on the entitlement ladder.
Meanwhile such is their wealth that from birth into adulthood they can employ expats first as
domestics and then to do their work.
There are passages in the medieval Islamic scholars’ texts which are critical of those who
employ “craftsmen and professional workers to do their work.” Such a sedentary population
“do not see any value in work” their “hope for profit (from their own labor) vanishes” and their
“civilization decays.”64
And so there is a cultural contradiction between the advice of the scholars and modern practice
which is taken by some commentators to explain the difference between the sustainability of
the traditional Arab business models. The model for Gulf Arabs from the dessert and the model
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for Gulf Arabs from the city disambiguates, with oil as catalyst, into the present range of Gulf
models.
Commentator Sami Alrabaa notes how “secure lucrative jobs are predominantly available in
government departments;” how population growth “of 2-3% per annum is increasingly making
it difficult” to provide enough jobs; how solid economic planning “is missing;” and how
“unlike business during early Islam and the Golden ages, deceptive bargaining and bribing have
become part of daily transaction.”65
So when the legacy of the medieval Islamic scholars is interpreted and an integral part of Gulf
education, and when the political leaders focus on the real need for economic development to
sustain their children, there is a chance for the culture to continue to change and transform and
“to stimulate progress and prosperity.”
The Market: Entitlements and Ownership
The entitlements which foster the generation of dead capital in the Gulf Model do not in
practice appear to be sustainable. There are a number of reasons.
Currency, Law, and language:
Economic development in the West has been based on three essentials for market activity. A
single currency, a single set of laws, and a single language. Successive Industrial Revolutions
have depended for their success on these factors. Just as Britain and then the United States
developed their economies with a single trading currency, so the European Union is trying to
copy this feature. A strong argument was made for “One market one money” 66 but there is an
equally strong argument which sees a loss of independence in managing the economy at the
national level and this and the lack of exchange rate flexibility for the Euro within Europe may
already have had “more serious adverse consequences than the trade-promoting benefits.”.67 It
is noteworthy that Sweden, Denmark, Switzerland and Great Britain have all decided not to
adopt the Euro and their growth has not suffered as a result.
The American and the British Commonwealth commercial activity in international markets
depends on the employment of a uniform commercial code. “Since the nineteenth century,
nations have been copying these laws.”68 The idea has been to provide the institutional
framework necessary for business to be conducted, as far as possible, without risk and
uncertainty. This commercial law, developed over several centuries, provides traders in global
markets with limited risk and a degree of certainty, and often provides the legal basis for
international commercial contracts. And yet “the drafting of a European contract code is still
far off.” 69 This is because the principles of European Contract law have not yet been separately
identified from UPICC (UNIDROIT70 Principles of International Commercial Contracts) and
become part of European legislation. Meanwhile the absence of progress towards a uniform
commercial code in the Gulf severely limits trade as global entrepreneurs often steer clear of
the uncertainty and risk attendant to doing business in the Gulf.
Unfortunately for graduating nationals, Gulf entrepreneurs do not always embrace
presumptions about the superiority of global business practices and the barriers to trade
caused by Gulf differences. The laws of property, currency exchange, and commercial
enterprise need to be functionally reliable and as in commerce “the language of
business is English.”71 But there is still a “huge resistance to such modernization from
the authoritarian and religiously obscurantist forces within the Arab-Muslim world”72
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The Market: Model:
Of particular interest in the context of the Gulf Market is Ghazali’s writing in Kitab Nasihat al
Muluk on the special role of government in an economy. In Kitab Ghazali warns rulers of “the
abuse of authority, pride, surrender to flattery, and deceitful religious scholars.”73 To some
extent, albeit it unintentionally this “abuse of government authority” may be seen to have failed
the youth of the Gulf. Governments must be aware of at least three of the strategic features of
the Gulf market. These are the trend in oil price, the trend in population, and the trend in
domestic productivity
Strategic features: Oil price
So little is being done to prepare the economy for the flood of Gulf youth when the value of oil
and the demographics of a growing population points so clearly to a time when oil revenue will
not generate sufficient wealth to afford the generous “welfare/entitlements” now available.
Consider the trend in the oil price in real terms is shown below.
Real crude prices* January 1970 to July 2005
* West Texas Intermediate in constant (July, 2005) U.S. dollars. SOURCES: Federal Reserve
Bank of St. Louis, and Bureau of Labor Statistics.
The trend is relatively stable in real terms and indicates that the future value of cash surpluses
now being generated will be worth significantly less in real terms in the future.
Strategic features: Population
Couple this with a current birth rate of 21.94 births per1,000 population.74 And take for
example Kuwait where there is an explosive increase of over 8% per annum of high school
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graduates increasing the current demand for university places and in the near future and
increasing demand for jobs, an example to be found elsewhere in the Gulf.
Taking the example of Kuwait, the demographics indicate and oil baby boom so that in the
period from 2005 to 2025 there will be an increasing demand for jobs, currently met by the
existing “welfare/entitlement” sector. There will inevitably be an increasing burden on the
state to continue to provide employment. Looking out to 2045 when, under present generous
“welfare/entitlement” provisions, the oil baby boomers will be entering upon retirement75 it is
easy to see that how ever large the existing accumulation of oil based investment in assets,
funds to continue payments over up to 30 years (on average) will be underfunded and in
practice appear likely to run out by 2050.76
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Source: U.S. Census Bureau, International Data Base, August 2006
version.
Strategic features: Domestic productivity
Gulf government are beginning to be aware of the problem. Efforts are being made to increase
levels of educational attainment. However the challenge facing Gulf countries is how to
generate “the productivity of knowledge workers.”77 We know that “the lowest level of
productivity occurs in government employment” so that the experiential context for Gulf youth
is not one of growing productivity.
Conclusion:
By far the least attractive feature of the Gulf Market to Western investors is the apparent lack of
discipline. Recently at the Kuwait & Middle East Conference for Combating Money
Laundering, following a detailed review of the existing law, it became clear that the necessary
legislation to control money laundering was enacted and in effect. At this point Stuart Yikona a
member of the World Bank’s Financial Integrity Unit, suggested that much more attention was
needed to be focused on the absence of discipline in the area.78 In particular he noted the need
for a streamlined prosecution effort and greater willingness of law enforcement authorities to
prosecute questionable market transactions.
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A speaker had noted that discipline in the financial and consumer markets in the Gulf seemed
to be akin to discipline on Gulf roads. Rules and regulations were in place but equally apparent
were there were too many drivers who not only lacked discipline but who found no
encouragement to improve their skills because of “wasta” so that the law was not being
enforced.
This lack of discipline was underlined by the Dean of Faculty and Islamic studies at Kuwait
University.79 There are so many invisible hands at work in the Gulf market. This comes from
the current blend of two cultures, the culture of people from the Gulf cities, the traders, and the
people who have come away from the desert. Tribal group feelings had no place in the trading
environment of the City and so “group feeling was wiped out.”80 However “because of the
poor life, hard conditions,” the group feelings or “wasta”, the “bad habits that are peculiar to
Bedouins,” has become part of the Gulf market model.
There are signs the current model is changing and that “many improvements have been
realized.”81 The move towards full membership of the World Trade Organization is a move
towards more discipline and “implies many regulatory challenges.” Most important from the
viewpoint of undergraduate students in the Gulf, is the need to recognize the real opportunities
that exist to become productive and to develop within the private sector.
____________________
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Endnotes
1
2
3
4
5
6
7
8
9
10
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14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
Wilfred Thesiger, Arabian Sands, (London: Penguin Books; 1991) 96.
S. M. Ghazanfar, Ed, Medieval Islamic Economic Thought, (London: RoutledgeCurzon, 2003) 18
Abu Abdullah Muhammad Ibn Musa al-Khwarizmi, author of the9th century text Al-Jabr wa-alMuqabilah, which when translated into Latin in the 12 th century, gave his name to Algorithms and
the name of his text to Algebra.
Kramers J. H., “Geography and Commerce” in Arnold & Guillaume Eds The Legacy of Islam
(Oxford, Clarendon Press, 1934)
Joseph A Schumpeter History of Economic Analysis, (Oxford: Oxford: University Press, 1974) 74.
Activity-based costing was first clearly defined in 1987 by Robert S. Kaplan and W. Bruns as a
chapter in their book Accounting and Management: A Field Study Perspective (Harvard Business
School Press 1987).
Including Abu Hamid Al-Ghazali; Ibn Al-Hadi; Ibn Sina; Ibn Taimiyah;
According to current Arab undergraduate students
Thomas L. Friedman, The World is Flat, New York: Farrar, Strauss, and Giroux, 2006) 493.
Translations from Ghanzanfa, Medieval Islamic Economic Thought, ibid)
For example: Registry certificates and other representative property documentation that provides
“a visible sign of the vast hidden process” (de Soto) that inter and intra connects assets to the
economy
Hernando de Soto, The Mystery of Capital, (New York: Basic Books, 2000) 6.
Abu Hamid Al-Ghazali, Ihya Ulum al-Din (The Revival of the Religious Sciences) 3.227
Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, first published in
1776. Bk II Chap 2.
Ibid: Wealth of Nations; Bk II Chap 2
Ibid Ihya Ulum al-Din: 2.83
Ibid Ihya Ulum al-Din: 2.75
Ibid Ihya Ulum al-Din: 4.119
Ibid: Wealth of Nations; Bk I Chap 1
Ibid Ihya Ulum al-Din: 1.55
Adam Smith, The Theory of Moral Sentiments, Smith’s greatest book 1759 Part 1. 3
Eamon Butler, Preface to the Adam Smith Institute’s 2001 Edition of The Theory of Moral
Sentiments.
Ibid Ihya Ulum al-Din: 4.192
Ibid Ihya Ulum al-Din: 2.312-315
See for example Ibn Taimiyyah’s Public Duties in Islam: The Institution of the Hisbah, trans
Muhtar Holland, Islamic (Leicester, England: Islamic Foundation, 1982) and Ibn Qayyim in Turuq
al Hukmiyah (mentioned in S.M. Ghazanfar ad Azim Islahi “Some Aspects of Ibn Qayyim’s
Economics”, Chap 9 in Medieval Islamic Economic Thought ibid 137.
Hennie Van Greuning and Marius Koen, International Accounting Standards 2nd Ed (Washington:
The World Bank, 2001) 1
Ibn Taymiya (Trans by Muhtar Holland) Public Duties in Islam: The Institution of the Hisba
(Leicester, England: the Islamic Foundation, 2004)
Ibn Qayym in his book al Turqal Hukmiyah quoted and translated by Ghazanfar ibid p 137
Ibn Khaldun, The Muqaddimah, Trans by Franz Rosenthal, (Oxford, England: Princeton
University Press, 1967) 178
Hamid Hosseini in Samuels, Biddle, Davis, Eds The History of Economic Thought, (London:
Blackwell, 2003) 36.
Ibid Muqaddimah: 273-4
The website www.islamic-world.net/economics/history_of_economic thought.htm lists 18 Islamic
economic scholars whose works have only been partially translated in to English.
Ibid: Wealth of Nations; Bk II Chap 2
Ibid Muqaddimah: 119
Ibid Muqaddimah: 97 “everybody’s affection for his family and his group is more important (than
anything else)”
Ibid Wealth of Nations:Bk 4 Chap 2 “By preferroing the support of domestic top that of foreign
industry, he intends his own security ……..”
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36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
Ibid Muqaddimah: 271
Cunningham & Soraya Wasta: The Hidden Force in Middle Eastern Society,( Westport, Conn.:
Praeger, 1993)
Baser Al-Saleh, “Wasta rife in Kuwait, Middle East,” Kuwait Times January 2007
Thomas Philip, Arab Times
Ibid: Arabian Sands:
Ibid: The Mystery of Capital: 11 et seq
Ibid: The Mystery of Capital: 10
The idea of International Financial Reporting Standards (IFRS) has been accepted by the Banks,
some international enterprises, and locally based enterprises listed on stock exchanges. However
the valuation of assets remains on the basis of IFRS as applied locally.
includes
Michael J Womey Oil Price Windfalls and Capita Outflows from MENA Oil Exporters (Dearborn
Michigan: University of Michigan, 2006)
Darryl
Macleod,
Capital
Flight
Library
of
Economics
&
Liberty
http://www.econlib.org/LIBRARY/Enc/CapitalFlight.html “Since the Third World debt crisis in
the eighties, the term "capital flight" has been applied more broadly to capital outflows from
residents of developing countries”.
Mehnaz Safavian, Heywood Fleisig, and Jevgenijs Steinbuks How Reforming Collateral Laws
Improves Access to Finance, (Washington: World Bank, 2006) Note No: 307
W.W Rostow The Five Stages of Growth (Cambridge, England: Cambridge University Press, 1990)
4-12
Ibid Stages of Growth: 5
Ref
The Dasman Diabetes Research Center was opened by His Highness the Amir on June 6, 2006
http://www.kfas.com/information_pages/news.htm
See for example Ali & Partners, Washington, DC “In recent years, the Kuwaiti government has
proposed the development of its northern oil fields with the participation of international oil
companies . http://www.mideastlaw.com/article_kuwait_oil_sector.html
Ibid Muqaddimah: 119
For example, Kuwait Times “Shuaiba explosion” January 24 page 4.
Odd Roger Enoksen, Minister of Petroleum and Energy Importance of technology for value creation
in the petroleum sector, Speech OG21 Forum, University of Oslo, November 24th 2005.
See http://skyscrapercity.com/showthread.php?t=208758
Waleed Al-Houti, Deputy Chairman Al-Aman Investment Company, Arab Times January 23 7
Al Humaidhi
For example in the case of the Al-Zour refinery Kuwait Times, January 2
IMF Executive Board 2006 Public Information Notice (PIN) No. 06/35
Current salary entitlements plus other allowances mean that Kuwaitis receive at least $25,000 per
year even with less than a high-school education.
Inspired by “Starvation is the characteristic of some people not having enough food to eat. It is not
there being not enough food to eat” Amartya Kumar Sen. Poverty and Famines: An Essay on
Entitlement and Deprivation, Oxford University Press.
Ibid Ihya Ulum al-Din: 3.346
Ibid Muqaddimah: 119
Sami Alrabaa, “Culture and Economic Progress,” Kuwait Times January 2007, page 2.
"The Economics of EMU. Background Studies for European Economy No. 44 One Market, One
Money. European Economy, Special ed., 1/1991. 245 pp
Does
One
Market
Require
One
Money?
Martin
Feldstein
http://www.kc.frb.org/PUBLICAT/sympos/1991/s91felds.pdf
Ibid, The Mystery of Capital: 12
Freidrich Blasé, Leaving the Shadow for the Test of Practice – On the Future of the Principles of
European Contract Law.
UNIDROIT – The International Institute for the Unification of Private Law
Michael D Kennedy, Building Capitalism and Ending Communism in East European Business
Culture, University of Michigan Seminar, Session 4.
Page 13 of 14
CIBS Conference: Reading 2007
72
73
74
75
76
77
78
79
80
81
Ibid: The World is Flat: 493
Ibid: Ihya Ulum al-Din: 4.192
List of countries by birth rate: http://en.wikipedia.org/wiki/List_of_countries_by_birth_rate
Full-pension Retirement age in the Gulf ranges from 47.
A model for Kuwait is under construction.
Peter F. Drucker, Post-Capitalist Society, New York: HarperBusiness, 1990) 83
Special Report, Kuwait Times, November 14, 2006, page 14
Professor Al-Tabtabae.
Ibid Muqaddimah: 100
Imed Liman Ed, Challenges & Reforms of Economic Regulation in MENA Countries, (New York:
American University of Cairo Press, 2003) 7.
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