Financial Institutions, Reforms, and Policies in Muslim Countries
Although strong evidence points to the existence of a relationship between economic development and growth and a well-developed financial system that promotes efficient financial intermediation through a reduction in information, transaction and monitoring costs, this linkage and the direction of causation is not as simple and straightforward as it may at first appear. The form of financial intermediation, the level of economic development, macroeconomic policies, and the regulatory and legal framework are some of the factors that can complicate the design of an efficient financial system. Most, if not all, Middle Eastern countries could benefit from financial reforms that would enhance the effectiveness of their financial system while making them less susceptible to crises. While most Middle Eastern countries have adopted the conventional interest-based financial system, a few, most prominently a non-Middle Eastern country Malaysia, are looking into financial reforms that would embrace and introduce elements of Islamic finance. The Palgrave Macmillan series on Financial Institutions, Reforms, and Policies in Muslim Countries breaks new ground by proffering studies that broadly address financial reforms and financial policies, whether in the context of conventional or Islamic finance in the broader Middle East, instead of the general pattern of focusing on financial or economic development in various Middle Eastern countries. As such, the series will also serve as a guide for the adoption of fundamental financial reforms in the Middle East region.