Despite its currently conservative character, the modern practice of Islamic finance lies on a bedrock of social, cultural and economic revolution. Examination of these revolutionary origins and their attendant jurisprudential implications reveal much about the schizophrenia plaguing Islamic finance today, of a largely formalist practice repeating the functional aims of the early revolutionaries and falsely understood by substantial portions of the wider Muslim community to be achieving such aims. Though the revolution has not come to pass, some of the comparatively radical functional approaches conceived in the context of the anticipated upheaval, and in particular those of the Iraqi Shi'i jurist Muhammad Baqir al-Sadr, deserve reconsideration and refinement as a means through which to reformulate the entire practice of Islamic finance in a manner that realizes more completely the aspirations of the broader Muslim community in its call for uniquely Islamic forms of human association in Muslim societies.
Sadr's revolutionary goals are very much consistent with the rhetoric that proponents of Islamic finance and economics use to justify their practice. Yet Sadr, unlike his contemporaries, developed a functional theory of jurisprudence that relied on particular, acknowledged ideological understandings of foundational text that was intended precisely to achieve the articulated goals. Moreover, Sadr relied on a loose network of Shi'i jurists, largely based in Najaf, Iraq, known as the marja'iyya, to provide a more objective form of legitimacy to his ideas. Under Shi'i doctrine, the marja'iyya is responsible under Shi'i doctrine for deriving the rules of the shari'a. To Sadr, the marja'iyya as an institution could establish legitimate, neutral and definable bounds to interpretation that distinguish it from purely individualized, subjective political argument. These parameters would undoubtedly reflect ever changing ideological and ethical understandings of the foundational texts of Revelation. Nevertheless, within that framework, objective, disciplining rules would emerge to constrain individualized subjectivity on the part of any single jurist engaged in the process of interpretation.
Some of the particularities of Sadr's economic and jurisprudential philosophy are grounded in his Shi'i context, but the broader lesson to be learned continues to resonate. While the dreams of economic revolution may have long faded, the absolute necessity of a jurisprudential revolution has not. Sadr's idea of a transformed and transforming jurisprudence, bounded by objective and neutral rules on interpretive process, imposed through the consensus of an interpretive community responsible for redefining the foundational texts from time to time, is instrumental to the development of a sensible and functional Islamic system based entirely in Islamic doctrine and responsive to the needs of the community.
Haider A. Hamoudi,
You Say You Want a Revolution: Interpretive Communities and the Origins of Islamic Finance,
Virginia Journal of International Law
Available at: https://scholarship.law.pitt.edu/fac_articles/106