This paper compares the likely macroeconomic consequences of achieving fiscal adjustment alternatively through reductions in public consumption or public investment or through increasing tax receipts. The most favorable medium-term growth and inflation outcome are associated with reduced public...

This paper attempts to present a viable approach for the design of an instrument of government finance (and monetary management) in an Islamic economy where conventional transactions based on an ex-ante promise of a risk-free rate of return are forbidden. Resources to finance government...