Institutions and Islamic Law

Adeel Malik has a very interesting essay responding to Timur Kuran’s excellent book The Long Divergence. There are many previous MR posts on Kuran’s thesis that Islamic law impeded the transition to impersonal exchange in the Middle East (see here and here).

I think The Long Divergence is one of the most important recent contributions to New Institutional Economics (incidentally I reviewed it for Public Choice). Malik takes on board Kuran’s main argument but then argues that it is not institutional enough because it does not tackle the argument that Islamic law was endogenous to the politics of the region.

‘Islamic law can be described, at best, as a proximate rather than a deep determinant of development, and that there is limited evidence to establish it as a causal claim. Finally, I propose that, rather than exclusively concentrating on legal impediments to development, a more promising avenue for research is to focus on the co-evolution of economic and political exchange, and to probe why the relationship between rulers and merchants differed so markedly between the Ottoman Empire and Europe.’

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