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Islamic Finance, Risk Sharing and Macroeconomic Policies

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  • Mirakhor, Abbas

Abstract

At one point it was estimated that in 2007, the total financial instruments, mostly derivatives, in the world was 12.5 times larger than the total global GDP. Similar development could be awaiting Islamic finance if the ingenuity of financial engineers continues to serve the demand-driven appetite for liquid, low risk, and short-term instruments. In that case, the configuration of Islamic finance would have failed to achieve the hopes and aspirations that expectations generated by the vision of benefits that truly Islamic finance could bring to mankind. In what follows, this paper will discuss an alternative trajectory that could allow the industry to converge to the ideal

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  • Mirakhor, Abbas, 2012. "Islamic Finance, Risk Sharing and Macroeconomic Policies," MPRA Paper 56338, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:56338
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    More about this item

    Keywords

    Islamic finance; risk sharing; macroeconomic policy;
    All these keywords.

    JEL classification:

    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • P4 - Political Economy and Comparative Economic Systems - - Other Economic Systems
    • P40 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - General

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