Financial Innovation and Engineering in Islamic Finance

This book provides two important contributions to existing theories in the financial innovation literature. First, it extends the existing literature of innovation orientation to a completely new field and construct that is based on a religious imperative as a framework within which financial innovation is constrained. It explains how an innovation orientation in IFIs can be directed within religious rules, which indicates that innovation orientation in IFIs is a learning philosophy. Second, the book introduces and examines the plasticity of Shariah as a shared boundary object and its dynamic role in managing tension and conflicting values in the financial innovation process. Furthermore, building on the empirical results, the study illustrates the insights that each theoretical lens affords into practices of collaboration and develops a novel analytical framework for understanding religious orientation towards financial innovation. This practical contribution, of the developed framework, could form the basis for a standardised framework for the Islamic finance industry. The book concludes by noting the policy and managerial implications of its findings and provides directions for further research.

Provides the reader with a comprehensive and original account of what constitutes a religious orientation towards financial innovation and engineering in IFIs Explains the role of religious rules in the financial innovation and engineering processes and how this role is enacted, and equips the reader with a practical framework for financial product development in IFIs Explores the historical context of financial innovation and engineering in the Islamic finance and economics thoughts over 14 centuries

Inhalt
Introduction.- The Context of Islamic Bankin and Finance.- Analysis of Financial Innovation and Engineering in the Literature.- A Historical Analysis of Financial Innovation in Islamic Economics and Finance from Inception to the 16th Century.- A Historical Analysis of Financial Innovation in Islamic Economics and Finance from the 16th Century to Present.- Traditional Theory of Financial Innovation.- Financial Innovation Theory from an Islamic Perspective.- Futures Contracts as an Underlying Product of Financial Engineering in Islamic Finance.- Options Contracts as an Underlying Product of Financial Engineering in Islamic Finance.- Outlining a Framework for Financial Innovation and Engineering in Islamic Finance.- Case Stduy: Analysis of Selected Shariah Compliant Financial Products.- Discussion and Conclusion.