Price Control in Islam

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Price Controls are government restrictions placed on sellers to maintain prices. This page examines price controls from an Islamic perspective.

Sources used as evidence against price control[edit]

The people said: Messenger of Allah, prices have shot up, so fix prices for us. Thereupon the Messenger of Allah صلی ‌اللہ ‌علیہ ‌وسلم said: Allah is the one Who fixes prices, Who withholds, gives lavishly and provides, and I hope that when I meet Allah, none of you will have any claim on me for an injustice regarding blood or property.

قَالَ النَّاسُ:‏‏‏‏ يَا رَسُولَ اللَّهِ، ‏‏‏‏‏‏غَلَا السِّعْرُ، ‏‏‏‏‏‏فَسَعِّرْ لَنَا. فَقَالَ رَسُولُ اللَّهِ صَلَّى اللَّهُ عَلَيْهِ وَسَلَّمَ:‏‏‏‏ إِنَّ اللَّهَ هُوَ الْمُسَعِّرُ الْقَابِضُ، ‏‏‏‏‏‏الْبَاسِطُ، ‏‏‏‏‏‏الرَّازِقُ، ‏‏‏‏‏‏وَإِنِّي لَأَرْجُو أَنْ أَلْقَى اللَّهَ وَلَيْسَ أَحَدٌ مِنْكُمْ يُطَالِبُنِي بِمَظْلَمَةٍ فِي دَمٍ وَلَا مَالٍ

SUNAN ABU DAWOOD 3451 [1]


Opinions of the Muslim Scholars[edit]

Ibn Qudamah[edit]
Two facts can be derived from the hadith. First, the Prophet did not control prices despite people’s pressure on him which should suggest that it is disallowed. If it were lawful the Prophet would have yielded to their demand. The second point is that the Prophet equated price control with injustice (zulm) and injustice is forbidden. The goods whose price was sought to be controlled were property of a man (trader). And that man cannot be prevented from selling his goods at an agreed upon price by the two parties, i.e. the buyer and the seller(Ibn Qudamah,1374:44).
In a way the control of price may give rise to price rise. The traders from outside will not bring their goods in a place where they would be forced to sell them at a price against their wish. The local traders would hide the goods instead of selling. People would get less than their need, so they would offer a higher price to obtain the goods. Both parties (sellers and buyers) would lose; the sellers because they were prevented from selling their goods, and the buyers because they were prevented fromful filling their needs. So this act will be termed as forbidden(Ibn Qudamah,1374:44-5).

Extra Reading[edit]

1. http://www.iefpedia.com/english/wp-content/uploads/2009/10/Price-Control-in-an-Islamic-Economy.pdf

2. https://www.numl.edu.pk/journals/subjects/156102656513-AL-BASEERA%207%20(Vol.4%20-%20Issue.%201)%20JUN-2015.pdf

References[edit]

  1. SUNAN ABU DAWOOD 3451, Book 24, Hadith 36 (In-book reference), Book 23, Hadith 3444 (English Reference)