Academic Entrepreneurship and Muamalat: Risk and Money in Commercial Transactions from an Islamic Perspective

Academic entrepreneurship involves the entrance of academic scientists into commercial ventures and activities. The basis of any relationship founded upon commerce is rooted in the desire of both parties involved in the exchange to benefit from the transaction. Shariah law establishes guidelines and principles to be applied to commercial transactions in order to ensure that transactions are compliant with Islamic morals and teachings. Focusing upon the role of contemporary money in commercial transactions, the present article distinguishes between the Islamic economy depicted by Shariah and the contemporary economy, with particular emphasis upon the function and nature of contemporary fiat money-based currencies. The use of contemporary moneys in contemporary domestic and international commercial transactions is considered in light of Islamic prohibitions on gharar, or risk and uncertainty, with particular emphasis on the effects of inflation and international currency exchange ratio fluctuation on the value function of contemporary moneys. In conclusion, policy implications and recommendations concerning commercial exchanges arising from academic entrepreneurship are considered in light of seeking to minimize, if not eliminate, risks arising due to the nature of the moneys utilized in contemporary commercial exchanges.