Purpose

The purpose of this paper is organized as follows. Section 2 reviews the literature on the subject matter, focusing on western economic literature and the Islamic economic paradigm, including the Quran, Sunnah, jurisprudence and Islamic philosophy thinking, to illustrate the origins of the Islamic approach to monetary systems. The money interest rate and its studies are explained, and the role of money and credit in the production function is considered. Then, it is shown that money maintains the demand for money in the overlapping generation model, as well as the consumption behavior of households. It is followed by an explanation of general Pareto optimality and the role of the money interest rate in inefficiency and nonoptimality for households and firms. Finally, Section 4 concludes the paper.

Design/methodology/approach

This paper studies the effects of money issuance and bank creation on Pareto optimality. In explaining the origins of the Islamic approach to monetary systems, the literature review, it focuses on western economics’ literature and Islamic economics paradigms such as the Quran, sunnah, jurisprudence and Islamic philosophy thinking. In modeling section, the authors show how banks’ fractional reserve credit is profitable. The authors also examine how the introduction of the money interest rate can change the Pareto optimality. In this regard, the comparison between two situations, namely, financing by the stock of money and borrowing in the credit market, indicates that welfare is reduced by the creation system and is inefficient (or nonoptimal). The result is that no money and no credits are created. The provision of this system compensates money by increasing the real money supply or deflation. To ensure Pareto optimality, it has been proven in the field of microfoundation that there should be no fixed money contracts and no money interest rates. It is necessary that the interest rate on consumption credit is zero or Qarz-al-Hasna is broken. Moreover, profit sharing is offered in the production sector.

Findings

As a result, the authors proved mathematically that the money interest rate must be zero to ensure productivity and Pareto optimality. On the other hand, the introduction of money or credit through loanable money leads to inefficiency, both in production and households and in the general equilibrium. The inflation generated by the credit system stimulates the change in the price level and perpetuates this inefficiency. Thus, if the authors want to return to the optimality condition, the interest rate on consumption credit must be zero or Qarz-al-Hasna is breached. However, the behavior of the fractional banking system and the credit mechanism teaches us that the money interest rate is an integral part of credit and loanable funds. Thus, the elimination of the money interest rate from the banking system without bank creation is implausible. Finally, to ensure Pareto optimality, it has been mathematically proven in the field of microfoundation that there should be no fixed money contracts and no money interest rate. It is necessary that the interest rate on consumption credit is zero, or Qarz-al-Hasna is broken. Moreover, profit sharing is offered in the production sector. The result is that no money and credit are created. The provision of this system compensates money by increasing the real money supply or deflation.

Originality/value

The capitalist theory of the definition of interest plays a decisive role in economic science. In this context, the authors are dealing with different vocabularies and terms for the interest rate. These different vocabularies have their origin in the different economic situations and especially determine the thinking of the schools. Because of the relationship between future and spot, the authors have to transform the variable “level” into the variable “interest rate” in the dynamic space. Finally, the exact explanations for the movement and evaluation of the economy are revealed by the correlation of the different interest rates.

中文翻译：

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提供伊斯兰的货币体系方法

目的

本文的目的安排如下。第 2 节回顾了有关该主题的文献，重点关注西方经济文献和伊斯兰经济范式，包括古兰经、圣训、法理学和伊斯兰哲学思想，以说明伊斯兰货币体系方法的起源。解释了货币利率及其研究，并考虑了货币和信贷在生产函数中的作用。然后，表明货币维持了重叠代模型中的货币需求，以及家庭的消费行为。随后解释了一般帕累托最优性以及货币利率在家庭和企业的低效率和非最优性中的作用。最后，第 4 节总结了本文。

设计/方法/途径

本文研究了货币发行和银行创建对帕累托最优的影响。在解释伊斯兰货币体系方法的起源时，文献回顾侧重于西方经济学文献和伊斯兰经济学范式，如古兰经、圣训、法理学和伊斯兰哲学思想。在建模部分，作者展示了银行的部分准备金信贷是如何盈利的。作者还研究了货币利率的引入如何改变帕累托最优。在这方面，比较两种情况，即通过货币存量融资和在信贷市场借款，表明创造制度减少了福利，是无效率的（或非最优的）。结果是没有货币和信用被创造出来。该系统的提供通过增加实际货币供应或通货紧缩来补偿货币。为了保证帕累托最优，微观基础领域已经证明，不应该有固定的货币合约，也没有货币利率。消费信贷的利率必须为零，否则 Qarz-al-Hasna 就会被打破。此外，生产部门提供利润分享。

发现

结果，作者从数学上证明了货币利率必须为零才能保证生产率和帕累托最优。另一方面，通过可贷货币引入货币或信贷会导致生产和家庭以及一般均衡的效率低下。信贷体系产生的通货膨胀刺激了价格水平的变化，并使这种低效率长期存在。因此，如果作者想回到最优条件，消费信贷的利率必须为零，否则 Qarz-al-Hasna 就会被破坏。然而，部分银行体系和信贷机制的行为告诉我们，货币利率是信贷和可贷资金的组成部分。因此，在不创建银行的情况下从银行系统中消除货币利率是不可信的。最后，为了保证帕累托最优，在微观基础领域已经通过数学证明，不应该有固定的货币合约，也没有货币利率。消费信贷的利率必须为零，否则 Qarz-al-Hasna 就会被打破。此外，生产部门提供利润分享。结果是没有创造货币和信用。该系统的提供通过增加实际货币供应或通货紧缩来补偿货币。

原创性/价值

资本主义的利息定义理论在经济科学中起着决定性的作用。在这种情况下，作者正在处理利率的不同词汇和术语。这些不同的词汇起源于不同的经济状况，尤其决定了学校的思维方式。由于期货与即期的关系，作者不得不将变量“水平”转化为动态空间中的变量“利率”。最后，不同利率的相关性揭示了对经济运动和评估的确切解释。