The paper serves as background material for the review of debated issues and standpoints in the theory and application of Islamic economics, IE; and for discussion of fruitful research avenues in application of IE to modern economies. The focus is on six areas: (1) theory: links between IE and mainstream economics; while topics (2) to (6) treat applications of the given directives in Islamic ec...

This paper intends to examine the methods of reasoning that are employed in Fiqh and critically discuss their adoption in Islamic economics. The paper argues that the methods used in Fiqh are mainly designed to find out whether or not a certain act is permissible or prohibited. Islamic economics, on the other hand, is a social science. Like any other social science its proper unit of analysis i...

The notion of " Islamic finance " was born during the tumultuous identity-politics years of the mid-twentieth century. Indian, Pakistani, and Arab thinkers contemplated independence from Britain, and independence of Pakistan from India, within a context of " Islamic society. " Islam was assumed to inspire political, economic, and financial systems that are distinctive and independent of the Wes...

At least from the nineteenth century onward, certain observers have viewed Islam as a religion that discourages entrepreneurship by fostering fatalism, conform-ism, and conservatism. 1 Leading Muslim reformers of the nineteenth century, including Jamal al-Din al-Afghani (1839–97), believed that this view confuses a perverted form of Islam, which counsels passive resignation to events, with auth...

The recent history of Islamic finance is riddled with a number of paradoxes. First, there is a great rift between the economics literature on Islamic finance, and the practical approaches taken by financial experts and practitioners in the area. Second, despite two or more decades of rhetoric regarding the development of uniform standards for Islamic finance, the market remains largely segmente...

This study compares the hazard of failure in Islamic and conventional commercial banks using survival models. The sample consists of 421 banks from 20 Middle and Far Eastern countries observed during the 1995 to 2010 period. The conditioning variables are of both bank-level and country-level type. The analysis suggests that Islamic banks have lower failure risk and are less interconnected which...

Each economy functions within a particular social framework, defined by its moral philosophy and legal system. What makes an economy Islamic is Sharīah, the moral/legal discourses of the classical fuqahā’, which defined the economy of classical Islam, shaped its micro and macro institutions, and modulated its actual performance. This economy, which was virtually effaced during the age of Europe...

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