Islamic Economics Institute

Wednesday Academic Dialogue (20)


Chair of Ethics and Financial Norms
Université Paris 1 Panthéon Sorbonne – King Abdulaziz University


8th Seminar : Islamic Versus Conventional Human Development Index:
Empirical Evidence from Ten Muslim Countries

Wednesday 04 May, 2016 (27 Rajab, 1437)

Dr. Necati Aydin

Associate Professor of Economics,
College of Business, Al-Faisal University



Given the fact that the Islamic economic paradigm differs from the secular capitalist paradigm in terms of its emphasis on morality and spirituality, we think the current Human Development Index (HDI) does not capture human development from an Islamic perspective. This paper consists of two parts. In the first part, we provided a paradigmatic, theoretical, and conceptual model for the suggested Islamic Human Development Index (iHDI). In the second part, we presented several proxy variables for multi-dimensional iHDI and tested the proposed index through empirical data for 10 Muslim countries. We developed eight dimensional composite iHDIs based on the understanding of human nature from the Tawhidi anthropology. These dimensions included physical, reasoning, spiritual, ethical, animal, social, deciding, and oppressive selves. We measured them using nine different indices, three of which came from the conventional Human Development Index (cHDI). We then compared the rankings of those Muslim countries in iHDI to those in cHDI. The iHDI rankings for all Muslim countries except two differed from those in cHDI. The difference was more substantial for countries with higher economic development. Thus, improved cHDI rankings for Muslim countries based on their economic development do not necessarily mean they move toward ideal human development. This finding confirms the need for an alternative human development indexing approach from an Islamic.
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