Islamic Finance, Risk Sharing and Macroeconomic Policies

Abbas Mirakhor ()

MPRA Paper from University Library of Munich, Germany

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

Keywords: Islamic finance; risk sharing; macroeconomic policy (search for similar items in EconPapers)
JEL-codes: E61 P4 P40 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (5)

Published in The 2nd ISRA Colloquium (2012): pp. 1-42

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