A review of Islamic mutual funds’ financial performance and investment style in Muslim and non-Muslim countries

Islamic finance has grown beyond its reputation of providing small-scale banking options and now provides investment and financing options for complex large-scale commercial transactions. Islamic investments are one area that has attracted the attention of investors due to its performance, especially during the economic downturn. The Shari’ah compliance nature of Islamic funds provides an opportunity for those Muslim investors to be part of the global investment sector who have previously been reluctant to invest in conventional mutual funds. The fact that the funds’ managers are prohibited from investing in activities such as weapons production, alcohol production and interest-bearing finance operations, makes Islamic mutual funds also attractive for those Non-Muslim investors who wish to invest ethically. Today there are hundreds of Islamic equity indices offered by Dow Jones, FTSE, MSCI and S&P. Despite the growing importance of Islamic funds, there have been limited studies exploring the performance of Islamic funds worldwide. Due to very limited data sets and not too rigorous analytical methods, these existent studies have neither investigated Islamic funds’ financial performance in noticeable detail nor analysed the investment style of more than six funds. For instance, relevant questions such as the financial performance of Islamic mutual funds’ beyond their investment styles or a difference in performance between funds from Muslim and non-Muslim countries have nearly not been investigated at all. Very recently, a study by Hoepner, Rammal and Rezec (2011) analysed the financial performance and investment style of 262 Islamic equity funds from 20 countries in five regions (Africa, Asia-Pacific, Europe, Gulf Cooperative Council-GCC, and North America). As comparison, previous studies did not even analyse 60 funds. Hoepner et al.’s study sampled a period of two decades and was therefore able to test the performance of the funds during economic booms as well as economic downturns. The findings of the study provide new insights into the performance of Islamic mutual funds in Muslim and Western markets and during financial crisis.

Non-competitive markets

Among all the paradigms in economic theory, the theoretical predictions of oligopoly were the first to be examined in the laboratory. In this chapter, instead of surveying all the experiments with few sellers, we adopt a narrower definition of the term “oligopoly”, and focus on the experiments that were directly inspired by the basic oligopolistic models of Cournot, Bertrand, Hotelling, Stackelberg, and some extensions. Most of the experiments we consider in this chapter have been run in the last three decades. This literature can be considered as a new wave of experimental works aiming at representing basic oligopolistic markets and testing their properties. The chapter is divided into independent sections referring to different parts of the oligopolistic theory, including both monopoly as well as a number of extensions of the basic models, which have been chosen with the aim of providing a representative list of the relevant experimental findings.

Non-bee insects are important contributors to global crop pollination

Wild and managed bees are well documented as effective pollinators of global crops of economic importance. However, the contributions by pollinators other than bees have been little explored despite their potential to contribute to crop production and stability in the face of environmental change. Non-bee pollinators include flies, beetles, moths, butterflies, wasps, ants, birds, and bats, among others. Here we focus on non-bee insects and synthesize 39 field studies from five continents that directly measured the crop pollination services provided by non-bees, honey bees, and other bees to compare the relative contributions of these taxa. Non-bees performed 25–50% of the total number of flower visits. Although non-bees were less effective pollinators than bees per flower visit, they made more visits; thus these two factors compensated for each other, resulting in pollination services rendered by non-bees that were similar to those provided by bees. In the subset of studies that measured fruit set, fruit set increased with non-bee insect visits independently of bee visitation rates, indicating that non-bee insects provide a unique benefit that is not provided by bees. We also show that non-bee insects are not as reliant as bees on the presence of remnant natural or seminatural habitat in the surrounding landscape. These results strongly suggest that non-bee insect pollinators play a significant role in global crop production and respond differently than bees to landscape structure, probably making their crop pollination services more robust to changes in land use. Non-bee insects provide a valuable service and provide potential insurance against bee population declines.

Measuring the economic value of pollination services: principles, evidence and knowledge gaps

An increasing degree of attention is being given to the ecosystem services which insect pollinators supply, and the economic value of these services. Recent research suggests that a range of factors are contributing to a global decline in pollination services, which are often used as a “headline” ecosystem service in terms of communicating the concept of ecosystem services, and how this ties peoples׳ well-being to the condition of ecosystems and the biodiversity found therein. Our paper offers a conceptual framework for measuring the economic value of changes in insect pollinator populations, and then reviews what evidence exists on the empirical magnitude of these values (both market and non-market). This allows us to highlight where the largest gaps in knowledge are, where the greatest conceptual and empirical challenges remain, and where research is most needed.

Cambium non est mutuum: exchange and interest rates in medieval Europe

A major gap in our understanding of the medieval economy concerns interest rates, especially relating to commercial credit. Although direct evidence about interest rates is scattered and anecdotal, there is much more surviving information about exchange rates. Since both contemporaries and historians have suggested that exchange and rechange transactions could be used to disguise the charging of interest in order to circumvent the usury prohibition, it should be possible to back out the interest rates from exchange rates. The following analysis is based on a new dataset of medieval exchange rates collected from commercial correspondence in the archive of Francesco di Marco Datini of Prato, c.1383-1411. It demonstrates that the time value of money was consistently incorporated into market exchange rates. Moreover, these implicit interest rates are broadly comparable to those received from other types of commercial loan and investment. Although on average profitable, the return on any individual exchange and rechange transaction did involve a degree of uncertainty that may have justified their non-usurious nature. However, there were also practical reasons why medieval merchants may have used foreign exchange transactions as a means of extending credit.

Voting rights of refugees

The book develops a novel legal argument about the voting rights of recognised 1951 Geneva Convention Refugees. The main normative contention is that such refugees should have the right to vote in the political community where they reside, assuming that the political community is a democracy and that its citizens have the right to vote. The basis of this contention is that the right to political participation in some political community is a basic right from the point of view of dignity and the protection of one’s interests. Due to their unique political predicament, 1951 Geneva Convention Refugees are a special category of non-citizen residents. They are unable to participate in elections of their state of origin, do not enjoy its diplomatic protection and consular assistance abroad, and – most fundamentally – are unable or unwilling, owing to a well-founded fear of persecution, to return to it; thus, they are in limbo for a potentially protracted period. Refugees, too, deserve to have a place in the world in the Arendtian sense, where their opinions are significant and their actions are effective. Their state of asylum is, for the time being, the only community in which there is any realistic prospect of political participation on their part.