The Long Divergence: How Islamic Law Held Back the Middle East

In the year 1000, the economy of the Middle East was at least as advanced as that of Europe, but by 1800, the region had fallen dramatically behind―in living standards, technology, and economic institutions. In short, the Middle East had failed to modernize economically as the West surged ahead. What caused this long divergence? And why does the Middle East remain drastically underdeveloped compared to the West? Kuran, one of the world's leading experts on Islamic economic institutions and the economy of the Middle East, provides a new answer to these long-debated questions.

He argues that what slowed the economic development of the Middle East was not colonialism or geography, still less Muslim attitudes or some incompatibility between Islam and capitalism. Rather, starting around the 10th century, Islamic legal institutions which had benefit the Middle Eastern economy in the early centuries of Islam began to act as a drag on development by slowing or blocking the emergence of central features of modern economic life. By the 19th century, modern economic institutions began to be transplanted to the Middle East, but its economy has not caught up and there is no quick fix today. Low trust, rampant corruption, and weak civil societies―all characteristic of the region's economies today and all legacies of its economic history―will take generations to overcome.