Towards abolishing the rate of interest in contemporary Islamic societies

Abstract EN

Demand for money and investment function in contemporary Islamic societies is measured through an econometric model to demonstrate that the rate of interest does not play any significant role in their determination.

The same technique shows the rate of interest to be a significant determinant of these variables in non-Islamic countries with similar economies.

It follows that prohibition of interest in Islam has influenced behaviour in Muslim countries.

and that abolishing interest is not going to pose serious problems for them.