Advanced Search
MyIDEAS: Login to save this article or follow this journal

Financial interest causing problems of monetary transmission as evaluated by the Islamic alternative

Contents:

Author Info

  • Hifzur Rab
  • Syeda Anjum
Registered author(s):

    Abstract

    Purpose – The paper's aim is to study the system of interest, its crippling of the market by monetary manipulation and creation of gross disparity and its consequences and to explore an efficient Islamic alternative. Design/methodology/approach – The application of science and its analytical tools analyses and solves economic problems. As regards Shariah perspective, it may be described as guided application of science to analyse and solve economic problems. Findings – Gross inefficiency of the system of interest arises from its conflict with nature. Its sustenance requires monetary manipulation; however, the manipulation together with interest and gross disparity and deprivation created by it cripple markets that fail to determine just prices and to maintain vital economic balances and lead to gross inefficiency resulting in massive crisis. Monetary manipulation is serious fraud and a crime against humanity. Complexity of economic environment created by dominance of interest and its manipulation of currency has created gross misunderstanding among contemporary Islamic scholars and they have failed to project efficient Islamic alternatives. Removal of these misunderstandings and misunderstanding on the growth aspect of Zakah seem to be essential for freeing humanity from the clutches of the system of interest. Linking currency with a suitable well-defined basket of national product provides a cost free exit from monetary manipulation. However, creation of mass awareness seems to be an initial first step. Research limitations/implications – Application of scientific approach and scientific knowledge to economic issues, especially the issue of currency, wealth measurement and analysis of system performance needs higher emphasis, efforts and resources. Practical implications – There is need to create awareness regarding massive losses the economy suffers due to interest and monetary manipulation and to persuade governments to link currency with a suitable and well defined basket of national product. Interest and monetary manipulation have no place in Islam and as long free floats continue to be manipulated those who shun interest and exploitation must correct their accounting for the element of fraud incorporated by monetary manipulation. Consumer price index and wholesale price index may be used as a measure of currency manipulation. Originality/value – It is an analytical study of economic problems and their efficient solution. It is most important for researchers, academics, government functionaries, social workers and all those who are concerned with economic growth, justice and welfare. JEL classification: J24, J18, J78, H42

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.emeraldinsight.com/journals.htm?issn=0828-8666&volume=27&issue=3&articleid=1949035&show=abstract
    Download Restriction: Cannot be freely downloaded

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by Emerald Group Publishing in its journal Humanomics: The International Journal of Systems and Ethics.

    Volume (Year): 27 (2011)
    Issue (Month): 3 (August)
    Pages: 184-200

    as in new window
    Handle: RePEc:eme:humpps:v:27:y:2011:i:3:p:184-200

    Contact details of provider:
    Web page: http://www.emeraldinsight.com

    Order Information:
    Postal: Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
    Email:
    Web: http://www.emeraldinsight.com/h.htm

    Related research

    Keywords: Accounting unit; Currency manipulation; Distribution of wealth; Economic crisis; Economic justice; Efficient solution; Interest; Islamic alternative; Wealth measurement;

    Find related papers by JEL classification:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Ahamed Kameel Mydin Meera & Moussa Larbani, 2009. "Ownership effects of fractional reserve banking: an Islamic perspective," Humanomics: The International Journal of Systems and Ethics, Emerald Group Publishing, vol. 25(2), pages 101-116, May.
    2. Islahi, Abdul Azim & Obaidullah, Mohammed, 2002. "Zakah on stocks: some unsettled issues," MPRA Paper 18631, University Library of Munich, Germany, revised 2003.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:eme:humpps:v:27:y:2011:i:3:p:184-200. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Virginia Chapman).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.