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Akhand Akhtar Hossain

capital goods. Low real interest rates, rapid employment growth and fiscal transfers raised both consumption and investment spending. Increased public investment under the government’s economic transformation programme, especially in the oil, gas and infrastructure sectors, is an example of successful Keynesian ‘pump priming’ that has, unsurprisingly, boosted economic activity and raised the level of employment. The indications are that Malaysian macroeconomic management has an intelligent and perceptive activist dimension that does not sit well with unfettered market

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Akhand Akhtar Hossain

This book reviews key aspects of central banking and monetary policy in selected Muslim-majority countries. While reviewing country-specific experiences and issues in inflation and monetary policy, and analysing them from an historical context, emphasis is given to the evolution of Islamic banking and finance and the consequent institutional developments for maintaining price stability. One recurring theme is that, although Islamic banking and finance may have created some complexities, it remains consistent with Classical monetary theory and has created opportunities for improving the infrastructure of central banks and monetary policy to maintain both price and economic stability. The introduction of Islamic banking and finance strengthens the argument for low and stable inflation and rule-based monetary policy. Monetary policy frameworks in these countries include exchange-rate pegging, monetary targeting and inflation targeting under varied restrictions on capital flows. Macroeconomic problems under these regimes are also highlighted and their policy implications drawn.
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Akhand Akhtar Hossain

, rather than the interest rates, are administratively determined. There is presently neither theory nor empirics to suggest that these profit dividend rates have a stable linkage with the inflation rate. Financial Institutions The Iranian banking sector comprises 28 financial institutions. They are grouped under four categories: (1) four public commercial banks; (2) four public specialized banks, associated with different sectors of the economy, namely agriculture, housing, export and mining industry; (3) 16  small private banks; and (4) four large privatized banks. The

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Muhammad Umer Chapra

against interest: is it compelling? 143 or the principal amount of the loan with the predetermined rate of return stands in the way. There was a reverse flow of funds as soon as there was a negative shock. Shocks can result from a number of factors, including natural calamities and unanticipated declines in the economies of borrowing countries due to changes in interest rates or relative export and import prices. Such shocks lead to a decline in confidence in the borrowing country’s ability to honour its liabilities in foreign exchange. The rapid outflow of foreign

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Akhand Akhtar Hossain

institutions. Islamic financial institutions operate under some financial sector and real sector restrictions, such as the prohibition of interest (riba), avoidance of contractual uncertainty (gharar), avoidance of speculative activity, including gambling (maysir) and prohibition of investment in prohibited (haram) industries, especially alcoholic beverages, gambling, pork products and pornography. Islamic financial institutions are therefore considered as specialized institutions with Islamic characteristics. For this reason, Muslim- ajority countries remain the natural

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Muhammad Umer Chapra

substitute rather than natural parents.19 Consequently, they develop psychological problems which adversely affect their moral and intellectual development and lead to juvenile delinquency. The quality of the future generation consequently declines. Any society where the quality of the future generation goes down significantly may not be able to maintain its moral, intellectual, technological and military supremacy in the long-run. In addition to the rise in family disintegration, there is also a decline in the willingness to get married. The marriage rate is currently at

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Muhammad Umer Chapra

with modern conditions to help minimize the risks and to create a climate of trust and confidence among all the participants in the Islamic financial market. Risks are not a peculiarity of only the Islamic financial system. They are present in all financial systems: risks associated with fiduciary money, interest rate and exchange rate fluctuations, loan default, operational failures, natural calamities and a range of other human, managerial and environmental weaknesses. The Islamic financial system is equally exposed to all these risks. The only risk that gets added

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Muhammad Umer Chapra

Mankind is faced with a number of serious problems that demand an effective solution. The prevalence of injustice and the frequency of financial crises are two of the most serious of these problems. Consisting of an in-depth introduction along with a selection of eight of Muhammad Umer Chapra's essays – four on Islamic economics and four on Islamic finance – this timely book raises the question of what can be done to not only minimize the frequency and severity of the financial crises, but also make the financial system more equitable.
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Muhammad Umer Chapra

importance to the material aspect of human well-being and tend generally to ignore the importance of the spiritual aspect. They often argue that maximum 41 Columns Design XML Ltd / Job: Chapra_Morality_and_Justice / Division: 02Chap2 /Pg. Position: 1 / Date: 12/8 JOBNAME: Chapra PAGE: 2 SESS: 4 OUTPUT: Mon Aug 18 11:37:20 2014 42 Morality and justice in Islamic economics and finance material well-being can be best realized if individuals are given unhindered freedom to pursue their self-interest and to maximize their want satisfaction in keeping with their own

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Murat Çizakça

, then another hugely important contribution took place in Egypt, when Dr Ahmed El Naggar launched his Mit Ghamr experiment, the first ever Islamic bank. It seems El Naggar was influenced both by the German Sparkassen , community savings institutions, during his Ph.D studies at the University of Köln, and by his profound knowledge of the classical Islamic mudaraba partnership. Combining the two, he designed a unique bank that avoided the rate of interest. 12 The bank was