BRIEF HISTORY OF MONEY IN ISLAM

5528 Words  23 Pages

A BRIEF HISTORY OF MONEY IN ISLAM AND ESTIMATING THE VALUE OF DIRHAM AND DÏN¥R

Abstract: Before the appearance of Islam, dÏn¥r and dirham were the currencies in use in the Byzantine and Iran empires, respectively. Both currencies were in use in preIslamic Arabia and continued to be so in the Islamic state. In 74 AH the Islamic dÏn¥r and dirham were minted. Estimating their value is a matter of considerable importance to those doing research in Islamic economics. This paper estimates the value of these two currencies using two methods ‘natural value’ and ‘purchasing power’. It finds that a dÏn¥r was worth 261 to 293 thousand riyals or USD 32.5-36.5.