The ideological underpinnings of Islamic economics and its supportive contractual framework, along with wide range of financial and business transaction options permissible under IF, allows a rich array of approaches, options and modalities for IF. IF and conventional finance interface. At another level, to properly nurture IF it is inevitable that IF relies on conceptual framework of conventional finance and its tools.
The implied adjustment process is slow and efficient. An alternative explanation of the converging countries’ adjustment to EMU can be obtained from a standard intertemporal macroeconomic model without a production sector. Such a model illustrates the crucial importance of the intertemporal substitution effects in consumption that dominated EMU’s early years.