 Sale-based debt instruments. Chapter 8 in Religion and Finance, 2019, pp 167-192 from Edward Elgar Publishing Abstract: Partnerships and equity-type financing is recommended by all three religions, but in practice debt financing has proved to be irresistible in Judaism, Christianity and Islam despite the strong prohibitions against usury. This chapter explores the various debt-based financial instruments approved by each religion, especially Islam, since Judaism has developed ways around interest-based instruments, while Christianity had eventually abandoned the prohibition against interest early in the nineteenth century. Another aim of this chapter is to examine how Christian and Muslim governments, having in the past used interest-free debt techniques to finance budget deficits, were led towards interest-based instruments. In particular, the first public debt issue in the United Kingdom in 1694 unleashed a golden period of public debt financing that shows no signs of ending. This leads to a broad-ranging analysis, drawing on the research of Reinhart and Rogoff, of how government debt can be reduced, along with an examination of the principles and precedents set by the Prophet Muhammad for Muslims. Keywords: Asian Studies; Economics and Finance; Law - Academic (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:elg:eechap:14654_8 Ordering information: This item can be ordered from Access Statistics for this chapter More chapters in Chapters from Edward Elgar Publishing |
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