This research discusses the determinants of inflation according to Al-Maqrizi, one of Ibnu Khaldun’s disciples. He argued that inflation is caused by natural factors and human error factors. Among those human error factors, government corruption and the excess supply of non-metal money. This study employs a critical review on the work of al-Maqrizi, ighatsatul ummah bi kasyfil ghummah, supported with a panel data regression on cross-country data related to the rate of inflation, the rate of corruption and the number of the natural disaster. The empirical data shows that the rate of inflation is positively related to the human error factors; corruption, tax, and money supply. The results indicated the relevancy of al-Maqirizi’s postulate to the modern days’ economy. However, natural disasters are not proven as a significant factor for inflation in the country level. This paper contributes to the importance of the study on the classical Muslim Scholars thinking to understand current economic problems and the way to solve it.
Determinants of Gross Savings Rate: Selected Cross-country Evidence using Panel Data Approach
