The framework under which macroeconomic policies can be formulated to create a stable economic environment is yet to be addressed. Meanwhile, many important and tenacious questions regarding the relationship between Islamic finance, risk-sharing and macroeconomic stability remain unanswered. The current Islamic economic framework is incapable of providing shared prosperity and economic equity to the society. This chapter provides an overview of the book regarding the issues of risk-sharing, Islamic finance and the foundation of Islamic macroeconomics. This chapter also highlights the empirical contribution of Islamic economics and finance towards a better understanding of economic development and macroeconomic stability. It also discusses the issues and challenges in practice, specifically in terms of their effect on growth, economic stability and economic shocks. This chapter provides a general conclusion that Islamic economics should go beyond the existing paradigm and create their own concepts and models whenever it is necessary to bring the field to the next level.
KeywordsRisk-sharing Macroeconomic Financial stability Islamic economics
JEL ClassificationG32 G34
- Agenor, P., Alper, K., & da Silva, L. P. (2013). Capital Regulation, Monetary Policy and Financial Stability. International Journal of Central Banking, 9(3), 190–237.Google Scholar
- European Commission. (2008). Financial Services Provision and Prevention of Financial Exclusion. Brussel: European Commission.Google Scholar
- Gadanecz, B., & Jayaram, K. (2009). Measures of Financial Stability: A Review. IFC Bulletin No. 31, Proceedings of the IFC Conference on Measuring Financial Innovation and Its Impact. Basel: Bank for International Settlements, 365–380.Google Scholar
- Houben, A., Kakes, J., & Schinasi, G. (2004). Towards a Framework for Safeguarding Financial Stability. IMF Working Paper No. 04/101. Washington, DC: International Monetary Fund.Google Scholar
- Kempson, E., & Whyley, C. (1999). Kept Out or Opted Out? Understanding and Combating Financial Exclusion. Bristol: The Policy Press.Google Scholar