Islamic Economics Studies Bi-quarterly Journal

Prospects of Bounded Rationality Theory in Islamic Economics

Document Type : Research Paper

Author

Associate Professor, Department of Economics, Imam Khomeini Education and Research Institute (IKI), Qom, Iran.

Abstract

In recent decades, bounded rationality has been accepted greatly in economics. In this approach, there has been attention to the boundaries of human beings in rational choice including his cognitive boundaries. The current paper analyzes the extent to which this theory is consistent with the Islamic approach to rationality and how we could improve it by using the capacities of Islamic economics. I hypothesize that we will find a form of bounded rationality in Islamic resources that could be improved to a form of flourished rationality. According to the findings of the paper, Islam has paid attention not only to the cognitive boundaries of human beings in the evaluation of options and mental accounting, but also to his motivational, emotional, and intentional boundaries. In Islamic approach, the strong inclination of man to non-calculated passions is one of its motivational boundaries that deviates him from rationality. To overcome with the boundaries of rational choice, Islam tries to improve the cognitive aspects of people as well as their self-control power and continence. There has been attention to the capacities of social nudges, religion and Islamic ethics and internal pre-commitments

Keywords

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Islamic Economics Studies Bi-quarterly Journal
Volume 13, Issue 2 - Serial Number 26
May 2021
Pages 181-210