Interest and the Modern Economy

The argument that modern economies cannot function without interest is examined in detail. We show that Islamic alternatives to interest, which vary with the context and the type of loan, provide adequate substitutes. Interest based institutions lead to many types of difficulties both practical and theoretical. Islamic alternatives provide solutions to these difficulties.interest; riba; Islamic economics; prohibition of interest; profit sharing; Ricardian equivalence; Modigliani Miller Theorem

The Economics of Stateless Nations: Sovereign Debt and Popular Well-being in Pakistan

The Government of Pakistan believes that “high and growing” indebtedness of the government is reflected in falling investment and growth rates of the economy, leading to growing poverty of the people. This paper examines how this came to be, and whether the connections implicit in this assessment do in fact exist? On this basis, the paper also comments on the efficacy of some current policy proposals. The conventional wisdom is that “persistent fiscal and balance of payments deficits are a fundamental source of Pakistan’s high debt burden” [Pakistan (2001), p. xv)].1 The State Bank of Pakistan (2001, p. 117) goes further: “This…public debt is the result of structural weaknesses in the domestic economy and the external account. Excessive government expenditures, stagnant tax revenues, high returns on government securities and inappropriate sequencing of financial reforms, led to a bludgeoning (sic.) domestic debt profile. On the external front, large current account deficits, stagnant export revenues and declining worker (sic.) remittances, effectively forced Pakistan into an unsustainable situation”. All this is true, but hardly exhaustive.

Impact of Different Levels of Schooling on Development of Students’ Social Attitudes

AbstractOne of the expectations of society from schooling is to develop students’ prosocial behaviors having roots in their knowledge, beliefs and social attitudes.  But the assessment procedures related to students’ social thinking and attitudes are generally missing in the instructional system.  The study, therefore, to fill the gap diagnosed as whether schooling offered something that developed students’ social attitudes, a prerequisite of prosocial behaviors. Hence, the preset empirical investigation explored the impact of schooling on the development of students’ social attitudes.  A sample from 16 schools of 480 students was taken, for which a ‘social attitude scale’, having four subscales, i.e., a) concern for others’ welfare, b) respect for laws, c) respect for others’ property and d) sensitivity to social issues, was developed to collect data.  Results of data analysis revealed that the overall impact of different levels of schooling for upward positive increase in students’ social attitude was negligible, although elementary schooling contributed more, as compared to secondary level.  Similarly public sector schooling across three stages had more impact on students’ social attitudes as compared to private sector schools.Keywords: Schools, Social attitudes, Prosocial and antisocial behaviors, Public and                   Private schoolin

Exchange Rate Misalignment in Pakistan: Evidence from Purchasing Power Parity Theory

This paper examines the validity of the purchasing power parity to evaluate whether the Pakrupee vis-à-vis the US-dollar has been overvalued since the introduction of managed floating exchange rate. The Johansen multivariate cointegration technique is applied for the period 1982Q2-2002Q4. A single cointegrating vector is identified whose coefficients conform in broad terms to the restriction implied by the PPP theory, lending support to the interpretation of the model as describing a long-run relationship. This support is reinforced by the results derived from the adjustment coefficient, which is identifies clear short-run tendency for the exchange rate to revert to the equilibrium value defined by the estimated long-run model. Furthermore, exchange rate misalignment is also calculated using the estimated long-run relationship to evaluate whether the Pak-rupee vis-à-vis the US-dollar was undervalued or overvalued since the inception of managed floating exchange rate system. Calculated misalignment shows a substantial undervaluation of the Pak-rupee vis-à-vis the US dollar.Exchange Rate, Pakistan

Interest and the Modern Economy

The argument that modern economies cannot function without interest is examined in detail. We show that Islamic alternatives to interest, which vary with the context and the type of loan, provide adequate substitutes. Interest based institutions lead to many types of difficulties both practical and theoretical. Islamic alternatives provide solutions to these difficulties

Interest and the Modern Economy

The argument that modern economies cannot function without interest is examined in detail. We show that Islamic alternatives to interest, which vary with the context and the type of loan, provide adequate substitutes. Interest based institutions lead to many types of difficulties both practical and theoretical. Islamic alternatives provide solutions to these difficulties

Customer Loyalty in FMCG Sector of Pakistan

The purpose of this study is to find an empirical relationship of proposed variables and to find the impact of customer satisfaction, trust, and corporate reputation on customer loyalty. This study attempts to contribute to the knowledge how FMCG companies of Pakistan can retain their customers by making them loyal through satisfaction, trust, and corporate reputation. A theoretical framework is proposed to suggest links among variables. The sample size selected for research constitutes 200 respondents, and these respondents belong to the cities of Rawalpindi and Islamabad, Pakistan. Multiple regression and correlation coefficient was used to examine hypothesized relationship. Regression analysis reveals that customer satisfaction, trust, and corporate reputation bring 79.0% change in customer loyalty. There is a strong positive yet significant relationship of trust and customer loyalty. Customer satisfaction & corporate image also posit a positive and significant impact on customer loyalty. The results indicate that FMCG companies in Pakistan should pay more attention toward the reputation of their company, satisfaction of their customers, and trust in order to build loyalty of customers. Generalizability and time constraint are the limitations of the study

A Maximum Likelihood Sequence Equalizing Architecture Using Viterbi Algorithm for ADC-Based Serial Link

Channel impairments in high data rates make Analog-to-digital (ADC) serial link a very attractive choice in terms of bandwidth efficient modulation; however, power limitation of these receivers make the ADC front-end design rather challenging [3]. By replacing traditional symbol by-symbol digital equalizer with a maximum likelihood sequence estimator (MLSE) receiver, in ADC serial link, we can produce a more optimal equalizing architecture in terms of noise, and simplify the complexity of the design in the analog front-end [7]. MLSE architecture is implemented using the Viterbi algorithm, in Matlab, and the parameters for the analog front-end circuits were defined by plotting the bit error rate (BER) as a function of different SNRs. Comparing the BER between the traditionally used MMSE equalizer and MLSE receiver BER was found to be lower for same SNR. Although using the Viterbi algorithm to determine the original signal sequence may make MLSE computationally challenging, the simplicity of analog front-end and lower BER makes this an effective choice for high bandwidth transmission in a digital-heavy receiver

Exchange Rate Misalignment in Pakistan: Evidence from Purchasing Power Parity Theory

Exchange rate provides a key link between the domestic and world markets for goods and assets. Therefore, a proper and detailed analysis of the behaviour of exchange rate is required. There is also growing agreement that prolonged and substantial exchange rate misalignment can create severe macroeconomic disequilibria and the correction of external balance will require both exchange rate devaluation and demand management policies. Thus the policy-makers have used PPP theory as a guide to represent the external competitiveness of a country, and as a benchmark against which floating exchange rates are judged to be misaligned. Developments in 1990s and 2000s show that cost associated with exchange rate misalignment is very high. Hence, the analysis of exchange rate determination in the presence of exchange rate misalignment is crucial for the policy purpose because of its role as a component of an early warning system [Berg, et al. (2000)]