10 Islamic Economics and Finance as an Alternative Approach to Financing the Local Development
Bilal Bagis
Dr. Bilal Bagis / Şirvan Kaya / Bahar Böçkün
The modern economic understanding based upon a rational point of view, individual profit maximization, debt and interest is in a serious predicament today. Especially, following the 2008 Global Financial Crisis, the need and interest for new developments and financing models increased gradually. Approach to economy and financing from the Islamic perspective may be one of the simple ways to overcome this growth and financing dilemma of the modern times. Islamic economics and finance can be an important solution to the new era with an understanding based upon assets, a culture of collective action and an understanding that prioritizes competition and production. Arguing for the idea of participation economy and partnership, Islamic Economics and finance may present an alternative solution by using the social capital efficiently, transforming it into physical and human capital; providing alternative financing ways and productivity increase. This study is based on the hypothesis that Islamic perspective can be used as an alternative model particularly to overcome the problem of financing. For this purpose, it focuses on the active use of social capital. In this respect, the study aims to reach the philosophical foundations of Islamic economics and accordingly aims to question the instruments proposed by conventional financial and economic understanding.
