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It has been estimated that some thirty Arab-Islamic writers wrote extensively on economic activity during the medieval period. Since research into the contributions of these writers is relatively new in the Western world, beginning only about fifty years ago, our understanding of the nature and significance of their contributions is tentative and incomplete. We do know, however, that among the more significant Arab-Islamic writers addressing economic issues were Abu Hamid al-Ghazali and Ibn Khaldun. Abu Hamid al-Ghazali Al-Ghazali (1058-1111), like other Arab scholars, wrote within a framework that integrated the philosophical, ethical, sociological, and economic facets of society into the overriding religious beliefs of his time and place. He was among the most significant intellectuals of medieval Islam, and his writings are known to have influenced St. ftomas Aquinas. His description of the evolution of markets through voluntary exchange is remarkably perceptive for one writing in the eleventh century, as was his insight into how markets link and coordinate economic activities with the evolution of specialization and division of labor. In earlier times, a loaf of bread may have resulted from the activities of one family, who planted, harvested, and ground the grain, then prepared and baked the bread. Al-Ghazali observed that in his time, a loaf of bread might be the product of a thousand workers or more. Realizing that increasing specialization and division of labor result in economic exchange, al-Ghazali was able to point to the difficulties of barter and the consequent need for a currency to facilitate these exchanges. He also examined a host of other economic topics: public expenditures, taxation, and borrowing; coinage and the debasement of coins; interest and usury; and how best to levy taxes to appropriately spread the tax burden on society. Like his contemporaries and those who followed for nearly five hundred years, al- Ghazali did not abstract economic from other activities. His insights and descriptions were always made in the broader context of his strongly held religious views, which constrained, and in some cases, proscribed, economic activity.
Early Preclassical Economic Thought35Ibn Khaldun Ibn Khaldun (1332-1406), likewise, was not interested in purely economic questions. His examination of economic topics was always tangential and in the context of broader concerns. Possibly his most interesting insight into economic issues arises in his broad, sweeping examination of how his society appeared to have what we would today call a developmental cycle, moving from rural desert-life society with low income, low craft skills, and small economic surplus to a nonnomadic society in which agriculture predominated, with higher labor productivity and incomes, economic surpluses, and population growth.