The Theory of Islamic Banking: Look Back to Original Idea. In: National Congress of FoSSEI and ASEAN Conference on Islamic Economics 2010, Universitas Sriwijaya, Palembang, 20/07/2010, Palembang. (2010)
Abstract
The early discussion on the banking theory limits the view only on mudarabah and musharakah as the foundation of the Islamic banking system. Nevertheless, the stylized fact presented here seems to indicate that they are utilized far less than other forms of Islamic financing. Some possible explanations as to why these instruments are not utilized to a greater extent are due to principal-agent problem. The problems still exist, if Islamic banks operate in the presence of many agents and principals. Therefore, in this paper, we suggest the optimal contract for profit-sharing in Islamic bank in two different characteristics, i.e., contracting for effort and contracting for outcomes.
| Item Type: | Conference or Workshop Item (Paper) |
|---|---|
| Keywords: | Islamic banking, Profit-Sharing, Principal-Agent Problem |
| Taxonomy: | By Niche > Islamic Banking > Banks and Banking > Finance |
| Collections: | Niche > Islamic Banking |
| Depositing User: | Ilya Nur Fateen Othman |
| Date Deposited: | 31 Jul 2026 07:59 |
| Last Modified: | 31 Jul 2026 07:59 |
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