Fundamental Principles of Islamic Economic System: Justice, Equity, and Moral Conduct

Abstract

This study aims to examine the application of Islamic economic principles in contemporary economic systems, focusing on their contribution to reducing socio-economic inequality, exploitation, and environmental degradation. The basic principles of Islamic economics, such as justice (al-'Adl), equality (al-Musawah), and moral behavior (al-Akhlaq), offer an alternative to the capitalist economic system by emphasizing wealth redistribution, sustainability, and social responsibility. This study uses a literature study method to analyze various relevant sources, including journal articles, books, research reports, and related policies. The results show that the application of Islamic economic principles, through instruments such as zakat, waqf, and Islamic banking, can reduce social inequality and improve people's welfare. However, the main challenges faced are inefficient management and limited implementation outside Muslim-majority countries. This study suggests the need for increased transparency in the management of zakat and waqf, as well as the expansion of the application of the Islamic banking system in the global economy. Overall, Islamic economic principles have great potential to create a more just, sustainable, and socially welfare-based economic system.