Publisher: The Islamic Foundation , UK
Author : M. Umer Chapra
Dr. Chapra is the Economic Adviser to the Saudi Arabian Monetary Agency. He has contributed several artiicles to scholarly journals and books.
About the Book
This is the first comprehensive study of the goals, nature and operations of the monetary system of Islam, which has justice as one of its most indispensable objectives.
For most people, including some Muslims, an interest-free economy is a mystery. Hence a number of questions are posed: -has Islam really prohibited interest and, if so, what is the purpose behind this?
-Can an economy run without interest?
-What will be the impact on resource allocation, svaings and capital formation, economic stability and growth?
Dr. Chapra takes the mystery out of the subject by answering these and a number of other questions by means of a thorough economic analysis. While he shows the rationale behind the prohibition of interest and the strengths of a purely equity-based Islamic economy, he also discusses problems and presents realistic solutions.
Dr. Chapra also elaborates the changes that must be introduced in the nature and operations of commerical and central banks, the auxillary institutions which must be established, and the new tools of monetary policy that must be developed to enable the Islamic money and banking system to function effectively. He however warns that the abolition of interest is not the only value of Islam and unless it is accompanied by a number of fundamental reforms in the social, economic and political institutions of Muslim countries, their economics cannot be transformed and socio-economic justice as well as a whole range of other important goals of Islam cannot be realised.