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Is global financial and social stability possible?

Masudul Alam Choudhury (Institute of Islamic Banking and Finance, International Islamic University Malaysia, Kuala Lumpur, Malaysia)

International Journal of Islamic and Middle Eastern Finance and Management

ISSN: 1753-8394

Article publication date: 11 November 2014

Abstract

Purpose

The purpose of this paper is to investigate on the social wellbeing aspects of human sustainability. Linked to this is the investigation on how economic stability and social wellbeing are interactively integrated together to establish the stability along with sustainability. What is the nature of the global financial architecture? Why has it defied formation? Have the underlying theory of financial economic theory, its variables and indicators, and axioms of man and society in their midst, denied the actualization of the intended institution? How can the global stability and well-being criterion be established from coordinated level of global socioeconomic consciousness?

Design/methodology/approach

A generalized evaluation model addressing the “as is” and the “as it ought to be” scenarios is formalized. An illustrative empirical example is provided to chart such a method of empirics using the episteme of unity of knowledge and its various ramifications.

Findings

Thus, there is a general perspective overarching the selection of theory, variables and their inter-causal consequences that the global financial architecture cannot answer. The institutional structure envisioned thereby is not representative of the lateral aggregation of membership in prevailing socioeconomic understanding. Instead, a complex yet unifying aggregation is carried out to receive its global acceptance? The episteme of unity of knowledge (Tawhid) in the Islamic perspective along with its methodological formalism and empirical and strategic implications for sustainable global financial stability is presented as the unique and universal alternative.

Research limitations/implications

More empirical analysis can be carried out by extending the critical portfolio variables and collecting data on them as required.

Practical implications

The paper evaluates the roots of human deprivation in an uncertain global order as being based on a quaint way of understanding socio-scientific reality and applying human consciousness toward its reconstruction. The paper then proposes an alternative and applied perspective of the opposite methodological worldview premised on unity of knowledge and unity of the world-system. This epistemology is referred to as Tawhid, meaning the oneness of God represented by organic unity in the order of everything.

Social implications

Within the world-system, complex as it is, abide the epistemological foundations of economic, financial and social thought. Thereby, the analytical extraction derived from the episteme of unity of knowledge (Tawhid) exemplifies the ethical reconstruction and its application in rigorous ways to attain sustained global financial and social stability.

Originality/value

This paper has suggested that under the prevailing paradigm of thought and its institutionalism the future of global financial stability is not sustainable as it has proved in the recent past. Yet there is a different epistemological way of rethinking the world-system in general in its interconnected dimensions and taking the specific example of the financial economy. Upon such new reconstruction, an entirely new methodological and strategic worldview can be established. This is the methodological worldview of unity of knowledge and its formalism.

Keywords

Acknowledgements

The author thanks Professor Mohammad Shahadat Hossain for improvising the SDA figures. Dr Mohammad Shahadat Hossain is a Professor of Computer Science in Chittagong University, Bangladesh.

Citation

Alam Choudhury, M. (2014), "Is global financial and social stability possible?", International Journal of Islamic and Middle Eastern Finance and Management, Vol. 7 No. 4, pp. 370-394. https://doi.org/10.1108/IMEFM-03-2014-0028

Publisher

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Emerald Group Publishing Limited

Copyright © 2014, Emerald Group Publishing Limited