The labor market in an Islamic setting: Review and prospects 1

This chapter presents the different aspects of the labor market. It provides a brief summary of the mechanism in the conventional labor theory, and focuses on the mechanism in the setting of Islam. The chapter explains the supply of labor, child labor, gender, demand for labor, and human capital. It then discusses the concept of wages but in the periphery of Shari’ah. The most influential parties in the labor market are the suppliers and the demanders; their interaction is the most important function of this market. Labor economics is discussed by theorists from two perspectives: the micro and macro dimensions. The labor supply has three main components: time, efficiency, and a number of workers. There is a serious lack of substantial literature regarding Islamic perceptions of social choices and welfare in the setting of the gender division of labor and child labor. Hassan argues that Islam permits women to work in economic activities and run their businesses as entrepreneurs.