Social Sciences, a tool to empower people and to instill welfare for the masses, moreover, certain economic policies are designed to enhance the perpetual prosperity of the people with respect to the trickle-down effect, induced due to certain economic policies, prodigiously enhancing the overall well-being for the populace. The 21st century is the era of mutable realms; the conventional approaches are being replaced by modern schools of thought. The concept of heterodox economics is budding with some extra pace because the prevailing system was unable to insulate the masses from series of crisis.
An economic system must fulfill these indicators:
- Human needs rather than human wants should be met by the economic models and of course the quality of life.
- Our social issues should be inculcated in the economic models to get some lucrative results.
- Provision of basic rights effectively, and equity should be made a core while the distribution of income.
- Every life should be considered valuable, moving towards bio centric concept rather than anthropocentric.
Moreover, the neo classical conventional theory is totally based on flawed concepts, and must be rejected or contemplated in totality. The economics today is a theoretical system, focusing on the mathematics, which floats in the air bearing little connection in the real world. Many top ranked scholars of economists with a viable say in the realms of economics state, conventional economics is a branch of mathematical and theoretical economics with no viable interpretation in the real world. This pertinent claim can be justified on the grounds of the financial crises of 2007-2008, because none of the leading economist could justify the collapse or in other words predict it beforehand. There are glaring gaps in the economic theories that a Congressional Committee was set up in 2010 to scrutinize the economic theory.
The conventional economic theory is meant to create artificial supply demand to determine the price, however, consumer behavior optimization through utility maximization is not an apt concept in the real world, same goes with firm behavior theory, in the light of profit maximization. This concept is further illustrated through the conflict between general equilibrium and the Marshillian cross. Finally, it is contemplated that free market forces operate to come towards optimality and efficient allocation of resources, however, the failure of the free hand theory in retrospect, has changed the dynamics of economics and is high time to look towards new voices.
Coming to the Islamic voices in economics, which provide paths with a rational not only at the individual level but also propagate a gateway towards running the machinery of a state. The balanced approach in Islamic system makes it more feasible to adopt as it encompass the mix of a different school of thoughts, but with some margins. Islamic economics allows the governments and individuals to act only in the acceptable dominions, so the concept of exploitation come to its end. The concept of Riba, a main reason behind the poverty and inequality, is prohibited in the Islamic system. Moreover, another perk of this system is the prohibition of contract in presence of uncertainty (the reason behind exploitation).
Pakistan has the potential to rely on its own resources, what we need is to make our economy self-dependent, by the establishment of the research centers aiming at the systems which must be based on the paradigm of welfare. Pakistan needs to come out of the existing financial system bit by bit, whose cons are much gigantic than its pros. Institutional strengthening by the provision of the state-of-the-art amenities is a pertinent need of this era, especially in Pakistan.
In this era of self-centeredness, we need to shift the paradigm first, then come towards the perfection of economic models. The selfish behavior, which is the basic step of the orthodoxy, focuses on the principle of survival-of-the-fittest. While in contrast the new voices advocate big-heartedness and cooperation, but with the obligation of shifting the world views. When there would thrive for needs, not wants, the social problems due to orthodox economic models would come to end. Basic needs of the people in a state should be acknowledged as a social obligation. The Lorenz curve (an inequality indicator) shows a lot of deviation in most of the country, because of the booms for luxuries rather than the need. An economic system which focuses on fulfilling the needs of the people by the society collectively; should be embraced, does not it sounds amenable to strive for?
