Logo
Munich Personal RePEc Archive

Risk-sharing versus risk-transfer in Islamic finance: An evaluation

Hasan, Zubair (2015): Risk-sharing versus risk-transfer in Islamic finance: An evaluation. Published in: Journal of Islamic Banking & Finance , Vol. 32, No. 2 April-June (April 2015): pp. 11-28.

[thumbnail of MPRA_paper_65368.pdf]
Preview
PDF
MPRA_paper_65368.pdf

Download (592kB) | Preview
[thumbnail of MPRA_paper_65368.pdf]
Preview
PDF
MPRA_paper_65368.pdf

Download (592kB) | Preview

Abstract

Some recent writings on Islamic finance have resuscitated the old‘no risk, no gain’ precept from the earlier literature in the wake of current financial crisis. They argue that the basic reason for the recurrence of such crisesis the conventional interest-based financial system that rests purelyon transfer of risks. In contrast, Islam shuns interest and promotes sharing of risks, not their transfer.The distinction is used to make a case for replacing the conventional system with the Islamic; for that alone is thought as the way to ensuring the establishment of a just and stable crisis freeeconomic system. Islamic banks have faced the current crisis better than the conventional is cited as evidence. This paper is a critique of this line of argument and concludes that the case is for reform not for replacement of the current system marked with increasing duality.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.