Tag: Islamic Finance

Assessing Universal Basic Income: An Islamic Historical and Maqāşidī Perspective

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Group of people in traditional clothing gathering around a table of coins with five illuminated Islamic principles above

The authors identify a significant blind spot in modern Islamic economics, noting that contemporary Muslim jurists have historically ignored the concept of a universal, unconditional cash transfer. This silence stems from a long-standing academic preoccupation with targeted, faith-based wealth redistribution mechanisms like Zakāh and Sadaqah, which are structurally designed for selective poverty alleviation rather than serving as a baseline macroeconomic floor for every citizen regardless of financial status. By shifting the analytical lens toward the broader state obligation of ensuring collective welfare, the authors construct a fresh, normative framework that integrates UBI within an Islamic moral economy.

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Integrative Methodology of Islamic Economics: A Note

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The methodological contribution of Shaikh (2026) is to formulate, more sharply than most of the literature, the choice between an assimilative economics that prices the sacred and a distinctive economics that abandons the analytical, and to argue – on the strength of World Values Survey evidence of broadly shared moral and market attitudes – that the discipline should occupy neither pole but an integrative middle. That diagnosis is sound, and the integrative impulse is the correct one. Its limitation is structural rather than substantive: Shaikh (2026) integrates the scope of analysis while partitioning its method, housing market and beyond-market behaviour under one disciplinary roof but assigning each its own separate toolkit. The result is integration by segregation, a one- dimensional fork resolved by keeping the two domains apart, and the seam shows wherever a single decision carries mixed motives.

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Beyond Prohibitions: Unveiling the Hidden Dynamics of Islamic Economics and Finance

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Book titled Islamic Finance Principles Practice and Innovation by Dr. Abdullah Al-Hassan with intricate gold and teal Islamic design

This research paper provides a theoretical reframing of the objectives underlying Islamic economics and finance. While Islamic finance is largely known for avoiding specific prohibitions—such as Riba (interest), Gharar (excessive ambiguity), and Maysir (gambling)—critics argue that it has become operationally identical to conventional finance. The author argues against this phenomenon of ‘Shariah arbitrage’, where the outward form is Islamic but the substance remains conventional.

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Breaking the Trap of Debt, Inflation, Interest and Poverty

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The book by Qanit Khalilullah and Sohaib Umar offers a critique of the modern fractional-reserve banking system, arguing that it is the primary engine behind chronic economic instability, inflation, and wealth inequality. The authors propose a radical macroeconomic transition to a full-reserve banking model. This proposal is specifically tailored as a structural panacea for Pakistan’s crippling debt crisis, while simultaneously being framed as a genuine path to establishing a Shari’ah-compliant Islamic financial system.

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Moral Reflections on Economics, Vol 6, Issue 6

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Port congested with shipping containers and ships, protesters with signs for peace, wildfires and flooding nearby, map of disrupted trade routes

May 2026 issue (Vol 6, Issue 5) of Moral Reflections on Economics features

• “From Ontological to Epistemic–Institutional Halal” by Prof. Dr. Turalay Kenc, INCEIF University, Malaysia.

• “The Social and Cultural Importance of Hajj”  by Dr. Salman Ahmed Shaikh.

• Highlights of Global Trade Report by Muhammad Hammad.

• Book review of “Breaking the Trap of Debt, Inflation, Interest and Poverty” by Qanit Khalilullah and Sohaib Umar.

• Research paper in focus on “Beyond Prohibitions: Unveiling the Hidden Dynamics of Islamic Economics and Finance” by Prof. Dr. Burhan Uluyol.

• Regular sections of reflections, market news, economic and financial indicators and call for papers.

Download at: Periodicals

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Moral Reflections on Economics, Vol 5, Issue 12

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December 2025 issue (Vol 5, Issue 12) of Moral Reflections on Economics features: “The Dual Structure of Islamic Economics: Economics of Religion and Religious Economics” by Assoc. Prof. Dr. Mohd Nahar Mohd Arshad, Department of Economics, KENMS, IIUM;
“Stabilizing Purchasing Power of Common Medium of Exchange”  by Hifz Ur Rab; Highlights of Islamic Finance Development Report by Hammad; Book review of “Capitalism: A Very Brief Introduction” by James Fulcher reviewed by Aisha Wani; Research paper in focus on “Utility Maximization, Morality, and Religion” by Dr. Jonathan E. Leightner and regular sections of reflections, market news, economic and financial indicators and call for papers.

Download at: https://islamiceconomicsproject.com/periodicals/

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Methodology of Economics: Secular Versus Islamic

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The author asserts that Islamic economics is currently the result of applying Islamic rules and injunctions (Fiqh) to the secular economic framework, and is not yet a separate discipline that fully replaces secular economics. The author notes that methodology is a messy and confusing area in both fields. He highlights that in Islamic economics, it is often wrongly treated as a research design or work plan. The author explains that economics is usually called ‘science’ and is seen to be built for achieving its objectives on some perception of rationality. Methodology is the ‘theory of theories’; in the field of economics it refers to the “process economists use to authenticate the knowledge about economic phenomena”.

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Debt Dominance Vs Risk-Sharing Ideals: How Sukuk Reshape the Debate

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Using a contract-theoretic model, Khan compares two financial arrangements: the Fixed Return Scheme (FRS), which mirrors conventional debt, and the Variable Return Scheme (VRS), which represents profit-and-loss sharing (PLS) contracts such as Mudarabah or Musharakah. His analysis assumes a single lender allocating a fixed pool of funds across many independent projects, with symmetric information and costless observability.

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Moral Reflections on Economics, Vol 5, Issue 9

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September 2025 issue (Vol 5, Issue 9) of Moral Reflections on Economics features
• “Central Bank Digital Currencies Through an Islamic Lens” by Dr. Ilma Khan, Jamia Millia Islamia, India.
• Highlights from Lecture on “Islamic Worldview and Sustainable Development: Limits of Legal Compliance and the Need for Ethics” by Prof. Habib Ahmed, Professor, Durham University, UK.
• “The Role of Integrated Value Mediation in ESG Frameworks: Transforming Circular Agriculture within an Islamic Economic Context” by Davi John J S. Palo.
• Book review of “Islamic Economics: A Short History” by Dr. Ahmed El-Ashker and Prof. Rodney Wilson.
• Research paper in focus on “Relational business model for shared responsibility” by Dr. Josef Wieland and Dr. Jessica Geraldo Schwengber.
• Regular sections of reflections, market news, economic and financial indicators and call for papers.

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ESG and Banking Performance in Emerging and Developing Countries: Do Islamic Banks Perform Better?

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The banks’ ESG commitment can be in the form of adopting ESG framework in their banking operation and business strategy, incorporating ESG in credit assessment, and integrating ESG commitment in their banking products. In the case of Islamic banks, incorporating the environmental pillar can be adopted in the form of promoting green financing and integrating environmental risks in the banking operation. At the policy level, the financial authority is required to have an ESG framework to be implemented in the banking industry. 

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