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Monetary Management In An Islamic Economy

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  • CHAPRA, MUHAMMAD UMER

    (Islamic Research & Training Institute)

Abstract

Managed money is a new phenomenon which has gained prominence after the collapse of the Bretton Woods system in August 1971. There is no possibility of finding a precedence for it in the days of the Prophet (pbuh) or in early Islamic history. A number of questions are, therefore, continually raised about the monetary system that a Muslim country may adopt. Is it necessary to go back to the then-prevailing system or is it justifiable to continue the managed money standard that now prevails almost in every country around the world, including the Muslim countries? If so, what constraints may have to be placed upon this system to enable it to help realize the maqasid al-shari’ah (goals of Islamic teachings, referred hereafter as the maqasid), and what policy instruments may be used to realize these goals? This paper tries to answer these and some other related questions.

Suggested Citation

  • Chapra, Muhammad Umer, 1996. "Monetary Management In An Islamic Economy," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 4, pages 2-35.
    • Handle: RePEc:ris:isecst:0099
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    Cited by:

    1. Uddin, Md Akther, 2016. "Reemergence of Islamic Monetary Economics: A Review of Theory and Practice," MPRA Paper 72081, University Library of Munich, Germany.
    2. ALJARHI, Mabid, 2018. "The Islamic macroeconomic model: How to Apply it," MPRA Paper 103397, University Library of Munich, Germany, revised 01 Oct 2020.
    3. Ascarya, 2012. "Transmission Channel And Effectiveness Of Dual Monetary Policy In Indonesia," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 14(3), pages 269-298, January.
    4. Uddin, Md Akther, 2014. "Can GDP growth rate be used as a benchmark instrument for Islamic monetary policy?," MPRA Paper 67696, University Library of Munich, Germany.
    5. Uddin, Md Akther & Halim, Asyraf, 2015. "Islamic monetary policy: Is there an alternative of interest rate?," MPRA Paper 67697, University Library of Munich, Germany, revised 07 Jun 2015.
    6. Cizakca, Murat, 2010. "The case against the Islamic gold dinar," MPRA Paper 26645, University Library of Munich, Germany.
    7. Rabiu Abubakar Abba & Besar Bin Ngah, 2020. "The Potentials of Islamic Banking on Poverty Alleviation in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(8), pages 438-443, August.
    8. Uddin, Md Akther & Ali, Md Hakim & Radwan, Maha, 2019. "Can GDP Growth Linked Instrument Be Used For Islamic Monetary Policy?," MPRA Paper 102888, University Library of Munich, Germany.
    9. Hossain, Akhand Akhtar, 2014. "Empirical relationships among money, output and consumer prices in nine Muslim-majority countries," Journal of Asian Economics, Elsevier, vol. 31, pages 42-56.
    10. repec:idn:jimfjn:v:3:y:2018:i:specialissued:p:1-16 is not listed on IDEAS
    11. Ashief Hamam, 2011. "A sharia return as an alternative instrument for monetary policy," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 3(1), pages 97-107, April.
    12. Mohd Afandi Abu Bakar* & Noormahayu Mohd Nasir & Farrah Dina Abd Razak & Nor Samsinar Kamsi & Asmalia Che Ahmad, 2018. "Provision for Bad & Doubtful Financing and Contingency Reserve Management: Assessing Resilient and Stable Islamic Banks," The Journal of Social Sciences Research, Academic Research Publishing Group, pages 621-627:6.
    13. Maulana Rifki Aditia & Eko Fajar Cahyono, 2018. "Responsiveness Of Social Values And Real Gross Domestic Bruto On Money Demand In Indonesia," Journal of Islamic Monetary Economics and Finance, Bank Indonesia, vol. 3(Special I), pages 63-78, May.
    14. Uddin, Md Akther, 2019. "Islamic Monetary Economics: Insights from the Literature," MPRA Paper 102887, University Library of Munich, Germany.

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