"Islamic Finance Researches" (IFR)

The Feasibility of Implementing Social Trading in the Capital Market of Iran

Document Type : Science - Research (Islamic Capital Market)

Authors

1 M.A. Student, Islamic Financial Economics, Department of Economics, Mofid University, Qom, Iran

2 Assistant Professor, Department of Economics, Mofid University, Qom, Iran

Abstract

In the framework of Islamic Sharia, those types of financial instruments can be used in the Islamic capital market that fully meet the criteria and rules of jurisprudence and are useful from an economic point of view. Jurisprudential standards mean the general and private jurisprudential standards of contracts. In the article "Analysis of the Nature and Function of Social Trading from the Point of View of Compliance with Sharia" it was stated that social trading due to having the conditions of correctness of contracts and being free from jurisprudential obstacles such as the unjust enrichment, uncertainty, loss and damage, gambling and usury is an irrevocable contract, and its provisions must be adhered to. Examining the economic function of these transactions according to micro and macroeconomic criteria also indicated that social trading, in addition to being in line with the diverse goals and attitudes of investors, are in line with economic growth and justice, and it can be used in the financial policies of government. These transactions affect the efficiency and liquidity of the market by increasing the amount of investment in the capital market, increasing total production, fair distribution of income, curbing inflation and attracting foreign capital that finally contribute to the economic growth. As a result, the correct use of this instrument in the capital market of Islamic countries is a great opportunity, which can help to improve its development. In this research, the possibility of adapting this instrument to the contracts approved by Islamic jurisprudence is investigated through the jurisprudential analysis method. The results indicate that these instruments can be used in Iran's capital market by using certain contracts such as ju’alah, advocacy and lease.

Keywords

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Volume 12, Issue 2 - Serial Number 24
February 2023
Pages 345-380
  • Receive Date: 11 May 2023
  • Revise Date: 20 August 2023
  • Accept Date: 07 November 2023