Islamic Finance

Islamic finance can be considered a beneficial addendum to conventional financial products. The ethical principles fundamental to Islamic finance (in particular, the ban on interest) can attract non-Muslims and affect conventional finance, even if for others they only offer a chance to vary their portfolios or profit. However, a thriving Islamic finance sector may help to tackle the interconnectedness between financial institutions and their business models “vices” (i.e., the enormous scale of activities on derivative markets and their reliance on short term borrowings). The conventional banking industry could learn from the Islamic financial sector and overcome the dependency on shortterm borrowing (Chapra 2007). Moreover, the Divine Economics framework can contribute to creating a bridge between Islamic economics and mainstream economics by providing a factual analysis of “how religious households behave” without highlighting the Islamic normative teachings (Qutait 2018). In this regard, the discussion on what can encourage responsible economic and financial behaviors can benefit from empirical studies focused on how faithful economic agents use resources and public goods and how preferences are amenable in the light of different beliefs and worldviews.