www.islamic-finance.com

Our Resources pages are divided into the following four sections: a library of papers authored by shari`ah scholars and academics; a primer on the main products adopted by modern Islamic financial institutions with some commentaries on the legal and theological basis underlying them; summaries of secular economic theory from various schools of thought; summaries of various common secular financial products.





Our collection of Library papers is available here





Islamic Contracts A brief introduction to Islamic contract types		What is Usury? Various methodologies for understanding the meaning of riba in Islam

Murabahah Sale at an agreed mark-up over the seller's costs		What is Gharar? Definitions and applications of the prohibition on contracts involving uncertainty

Ijara Leasing, the sale of usufruct, in Islam		Bay al-Sarf Rules on the exchange of money for money

Mudarabah & Musharakah Partnership contracts, where returns to the partners are calculated as a share of profits		Istisna`a Payment in advance for deferred delivery of a made-to-order item

Bay al-Salam Payment in advance for deferred delivery of a commodity		Sources of Law Qur'an, Ahadith, Ijma, Qiyas and related concepts ... ...

Beliefs What are the key concepts in Islam?		Basic History What happened from 0 AH to 1400 AH ...

Interviews with Scholars Responses from an international selection of specialists interviewed using an identical question set on key issues in Islamic economics, finance and banking.






Christian Thinking The Gospels teach universal love and the brotherhood of man. Christianity proclaims the worthiness of work for all in the material and spiritual sense ...		Thinkers of the Middle Ages Whilst many thinkers still dismissed the charging of interest upon forced borrowers, the requirements of merchants were increasingly seen as a justification for interest ...

The Mercantilists With decline in religion and the power of the Church, the accumulation of wealth comes to be seen as a normal motivation for the activities of men ...		The Bullionists Special group among the Mercantilists, having a different idea of how best to achieve the goal of accumulation of bullion that was common to both camps. Bullionists sought to revive old export prohibitions on bullion and state intervention in foreign exchange dealings ...

Early Classical William Petty 1623-1687. Founder of political economy. Professor of anatomy and music, physician and landowner. Friend of Pepys and Evelyn. Discards mercantilist idea that wealth arises from exchange ...		Classical Thinking Adam Smith, 1723 - 1790. Son of a Scottish judge, educated Glasgow and Oxford, teacher and tutor, then writer and finally Commissioner of Customs ...

The Physiocrats 18th Century French philosophers. Emphasis on agricultural interpretation shows new technique of isolating economic problems and then abstracting solutions ...		Socialist Thought Socialism embodies a belief that a central democratically elected authority can encourage a better production and distribution of wealth than a market in which private entities are left to operate freely ...

Communism Communism proposes that social control of economic life is desirable, including social control over the means of production and ownership of consumer goods ...		Marxist Thinking The Marxist school is based upon the thinking of Karl Marx. Marxism is the theory that economic forces determine the social and political structure of society, and is applied to explain the development of the capitalist society ...

Economic Ideas in Fascism Fascism proposes the sovereignty of the state over all kinds of national activity (and is therefore very similar to nationalism) ...		Historical School Wilhelm Roscher, 1817-1894, founds 'Historismus', for 40 years the most influential school of economic thought in Germany ...

Neo-Classical Thinking Neo-classical thought is characterised by the abandonment of the labour theory of value and the surplus exploitative interpretation. These are replaced in neo-classical thought by a utility theory of value and an admission of the productivity of capital ...		The Marginalists Hermann Gossen anticipates the ideas of Jevons, Menger and Walras and has since been acknowledged as the pioneer of marginal utility. He says that the mathematical method is vital otherwise economic process cannot be analysed ...

Austrian School Eugen von Bohm-Bawerk, 1851 - 1914, introduces formation of market prices by bidding and offering of market pairs, explains interest on the grounds that "present goods are, as a rule, worth more than future goods of like kind and number" ...		Keynesian School John Maynard Keynes 1883 - 1946. Professional economist, wide ranging intellect, charismatic, develops practical policy solutions, influence through Treasury position and UK delegation to Bretton Woods ...

Neo-Keynesian Thinking Development of Keynesian theory, mainly inspired in the USA. 'Macro-economics' becomes a widely accepted term for the Keynesian analysis, defined as economics concerned with 'unemployment, economic instability, inflation and economic growth' ...		The Monetarists Monetarism shifts preoccupation from fiscal policy to monetary policy. Changes in money supply become a major determinant of the level of economic activity ...





Institutional Framework The financial market is a market in which individuals and institutions can sell or purchase financial instruments from other individuals or institutions. A distinction is often drawn between wholesale users of the market, usually institutions, and retail users, usually private individuals ...		The Mathematics of Interest In financial theory one often encounters one of two concepts in the calculation of interest payments, those of 'simple interest' and 'compound interest'.

Forward Markets An actual forward price for any asset is a price that can be agreed now for a future transaction in that asset. The date of that future transaction defines the period of the forward price. Thus the one year actual forward price for gold is the price that can be agreed today for ...		Money Markets Traditionally, the term 'money market' comprises the market in short term interest-based instruments and the foreign exchange market. The following are some of the common products encountered ...

Bonds In the capital markets, a bond is a security that gives its owner the right to receive an amount of money stated on the face of the bond certificate (the face value) at a specified time in the future (the redemption date) and often also to receive specified payments of interest (coupons) at specified dates (coupon dates) ...		Equities An ordinary share in a commercial enterprise (called a common stock in the USA) stands in evidence of ownership by the shareholder of part of that enterprise's net assets. Shareholders have the right to receive dividends authorised by the board of directors of the company and paid on dividend dates ...

Options Theory In a simple form, an option is a contract between two parties that describes a right, but not an obligation, held by one of those parties over the other to ...		Interest Rate Options An interest rate guarantee (IRG) is an over the counter option on a forward rate agreement (FRA) period. A call on the forward rate is termed a BORROWER'S IRG and a put on the forward rate is termed a LENDER'S IRG ...