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== Top 20 FREQUENT WORDS ==
awqaf 174
waqf 131
islamic 92
cash 89

mudarabah 39
ottoman 39
economic 29
companies 26
foundation 26

vol 23
institution 21
endowment 20
islam 20
established 19
funds 19
important 19
imam 17
economy 16
management 16
vehbi 16



== DOCUMENT KEY POINTS ==
*all over the vast islamic world from the atlantic to the pacific unless otherwise mentioned this paper is based upon my forthcoming book murat izak a management of the charitable foundations awqaf islamic world from the seventh century to the present
*however defined this institution whereby a privately owned property corpus is endowed for a charitable purpose in perpetuity and the revenue generated is spent for that purpose stands out as one of the major achievements of islamic civilisation

*therefore assuming that the efficiency problems are solved the waqf system can significantly contribute towards that ultimate goal of every modern economist massive reduction in government expenditure which leads to a reduction in the budget deficit which lowers the need for government borrowing thus curbing the a crowding out effect and leads to a reduction in the rate of interest consequently reining a basic impediment for private investment and growth

*as far as the islamic world is concerned there is so much evidence to the contrary ie to the ubiquitousness of the public goods supplied by the awqaf that it would be more appropriate to talk about an excess supply of public goods rather than their scarcity
*as is well known the standard economic theory envisages that since as rational individuals consumers of public goods would tend to free ride they would fail to contribute to the costs of creating these goods

*the extent to which islamic awqaf were influenced by these ancient institutions and the extent to which they were the product of the genius of islam is a question that is still not resolved while roman origins have been rejected primarily byzantine but also mesopotamian sasanid jewish and buddhist influences have been accepted as plausible
*this ability may well have originated with a tradition attributed to prophet mohammad pbuh abu huraira may allah be pleased with him reported allah s messenger pbuh as saying a word of wisdom is the lost property of a believer he can take it wherever he finds it because he is more entitled to it

*finally the management of the waqf can be entrusted to the offspring of the founder so that while on the one hand careful and loyal management is assured on the other the offspring would pray for the deceased for thanks to his waqf he or she is not destitute
*the great islamic conquests enriched the muslim world beyond any imagination and prepared the economic preconditions for the imam muslim sahih muslim kitab al wasiyya al kutub al sittah we shuruhuha bab al sawab ba d al wafat hadith istanbul a ri

*but when women were made eligible to inherit this offended the local traditions and the arabs tried to find an indirect way to circumvent the new law and still apply a sort of primogeniture or at least to bequeath to only the male offspring
*it is well known moreover that when omar the second caliph endowed his land in khaibar he allocated its usufruct among other things to his offspring following the prophet s advice and that imam shafii himself had also endowed his house in fustat to his offspring

*the strongest refutation to the confiscation argument has been provided however by gerber who demonstrated that the women of edirne who had nothing to fear from confiscations established of their awqaf as family awqaf while of awqaf endowed by those who had the most of fear the elite were charitable

*izak a awqaf in history established the legality of cash awqaf let us now focus our attention the way they functioned in history
*approval is of further importance as it permits the establishment of cash awqaf with jointstock company shares as well

*in the mean time the lender leased the asset to the borrower so that the borrower could go on using it and the rent which was often exactly of the loan was nothing but interest
*the term they used was the so called istiqlal which has been described as follows istiqlal was outwardly construed as a sale the borrower handed over to the lender a piece of real estate supposedly as a sale but actually as a pawn

*first of all it was found that the borrowers were not entrepreneurs but consumers and that the capital supplied by the cash awqaf was not accumulated at the hands of a few enterprising individuals but was diffused throughout the society
*in short a cash waqf could function in reality just like a bank with one difference whereas a bank accumulates funds from a multitude of savers and then transfers these to entrepreneurs and earns its profits through the different rates it utilizes lending rate minus the borrowing rate constitutes the bank s profits

*why indeed did the ottoman cash awqaf not function like the western banks and contribute to the process of capital accumulation in the economy rather than limiting them primarily to the redistribution of capital why in other words did they finance merely consumption rather than entrepreneurial investment the answer lies in the method of lending and takes us back to imam zufar who had suggested that the awqaf funds should be transferred to the borrowers as the capital of a mudarabah partnership
*put differently imam zufar had envisaged a mudarabah partnership between the cash waqf and the borrower the former ie the waqf being the principal rab al mal of this partnership and the latter the agent mudarib

*this can be done in one of two ways either islamic banks establish associated companies with autonomous management which specialize in mudarabah investment or completely independent mudarabah companies are established by third persons and the capital of the cash awqaf is entrusted to these companies
*put differently providing cash waqf long term capital to the banks would not suffice we must also see to it that this capital is invested with close continuous personal management that mudarabah demands

*research has revealed that in the ottoman economy more than a quarter of the cash awqaf established in the city of bursa survived for more than a century and of these surviving awqaf owed their resilience to capital enhancement realized either by re investment of profits or receiving further donations from various other smaller cash awqaf the so called rahmenstiftung model mentioned above

*i call upon all my heirs my close acquaintances my business colleagues my fellow citizens who may be involved in this foundation and the officials who will assume its administration to accept this endowment as a bequest made to the turkish nation to protect it and strive with their best intention to achieve its original ai miss i request the auditing authorities of the state and when necessary its authorized agencies courts and judiciary never to depart from the dictates of their conscience when making decisions lest this foundation suffers harm and be diverted from its ai miss i have brought this enterprise into being as a result of lifetime of effort and sincere desire

*should the emergency fund not suffice to maintain the foundation s share in the conglomerate the board of trustees can allocate of the primary revenue of the waqf for this purpose
*faroqhi has shown how stagnation can ruin a waqf by providing evidence that due to the stagnant trade conditions more than half of the ankara revenue as calculated in gold coins was lost to this particular waqf and how the cloth market in konya was allowed to fall into ruins

*the ko specializes in education and has financed a highly ambitious secondary high school and a major university while the diyanet like the tabung haji of malaysia is involved in the organization of the annual pilgrimage to mecca and is represented in localities by religious functionaries
*in any case by stipulating fixed ratios of charity to administrative expenditure he seems to have been determined to avoid such proble miss finally we are informed that the vehbi ko foundation has been granted tax exempt status by the council of ministers on december

*the influence of the islamic law of awqaf on the development of the trust in england the case of merton college university of pennsylvania law review vol
*contemporary islamic economic thought a selected comparative analysis kuala lumpur ikraq heywood colin the red sea trade and ottoman awqaf support for the population of mecca and medina in the later seventeenth century in a

*izak a awqaf in history muslim imam sahih muslim kitab al wasiyya al kutub al sittah we shuruhuha bab al sawab ba d al wafat istanbul a ri
*shaw stanford the financial and administrative organization and development of ottoman egypt princeton princeton university press singapore majlis ugama islam annual report


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== DOCUMENT WORD ANALYSIS ==
=== Main Category ===
: AlHuda Material\riba


=== KeyWords ===
waqf awqaf ghair wwwdeeneislamcom benkari httpdeeneislamcomurmiscbooksghairsoodibenkari soodi islam cash vol endow ottoman studi econometric NA institut journal mudarabah foundation universal



== RELATED DOCUMENTS ==
:[[Awqaf in History and Its Implications for Modern Islamic Eco]] 
:[[Awqaf in History and its Implimentations for Modern Islamic ]] 
:[[Ghair Soodi Benkari ( in Urdu) by Taqi Usmani]] 
:[[Waqf-Bibliography]] 



== DOCUMENT REFERENCES ==


=== Number of Pages ===
28


=== Published Date ===
2006-06-05 13:26:47


== Full Document ==


[https://www.hodhood.com/en/HodHoodDocuments/IslamicFinance/Riba/Awqaf%20in%20History%20and%20Its%20Implications%20for%20Modern%20Islamic%20Eco.pdf Read the Full Document]


[[Category:Islamic Finance]]

[[Category: Riba]]