Proposal for innovation in the capital markets: esham
How does an Islamic state (or, for that matter, a corporation), borrow a substantial amount of capital from mostly Muslim savers or high net-worth individuals, and fast? In 1774, this was the question which the Ottoman Minister of Finance had to answer urgently. Defeated by the armies of Imperial Russia, Ottomans had to pay a huge war indemnity within a year. Moreover, since the borrowing had to be done by the government of the Caliph, it had to be Shari'a based.
Esham , Innovation , Capital markets
Cizakca, Murat. (2014). Proposal for innovation in the capital markets: esham. In Murat Cizakca (Ed.), Islam and the challenges of Western capitalism (pp. 533-535). Cheltenham, Glasglow: Edward Elgar Publishing Limited.
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