Some economic aspects of mudarabah

Mudaraba involves simple profit sharing and has been used throughout the ages of Islamic history. Through the use of mudaraba , diverse factors of production work together in a venture. Practicing mudaraba is consistent with the Qur'an and the sunna. The outlook of profit sharing may be used throughout the economy -- in commerce, industry, services, and agriculture. Once interest is removed from an economy, profit sharing needs to be free to spread ubiquitously throughout economic life; it is a better basis for an economy than interest. Mudaraba is a more just approach to operations than hiring arrangements. Of the various parts of an economy, the financial sector is particularly appropriate for profit sharing.