Empowerment in Mudarabah
As one of the equity-based contracts in the Islamic commercial law, mudarabah has been viewed as the ideal basis for an interest-free banking operation. This article studies mudarabah theory as described by the great Muslim jurists. It examines the legal rulings of the four main madhahib namely...
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| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Universiti Sains Islam Malaysia
2012
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| Subjects: | |
| Online Access: | http://ddms.usim.edu.my/handle/123456789/5310 |
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| Summary: | As one of the equity-based contracts in the Islamic commercial law,
mudarabah has been viewed as the ideal basis for an interest-free banking
operation. This article studies mudarabah theory as described by the great
Muslim jurists. It examines the legal rulings of the four main madhahib
namely the Hanafis, Malikis, Shafi'is and Hanbalis, and their relation to
the financia1 practice of the mudarabah during the medieval period. The
focus of discussion will be the scope of empowerment given by the
investor to the agent-manager. It is found that the jurists differed in
determining the restrictions to be placed upon the agent-manager in
managing the capital entrusted to him. From a modern perspective, the
Hanafis appeared to be the most flexible in comparison with the other
three madhahib. In conclusion, the article will be a valuable addition to
our understanding of mudarabah and perhaps, this will help us to develop
a better equity-based financing instrument in the contemporary period. |
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