ARTICLE

CONSTRAINTS FRAMEWORK FOR FAIR PROFIT DISTRIBUTION IN PARTNERSHIPS FOR ISLAMIC DEPOSITS A CRITICAL ANALYSIS OF LITERATURE

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46 Pages : 431-444

http://dx.doi.org/10.31703/gssr.2020(V-III).46      10.31703/gssr.2020(V-III).46      Published : Sep 3

Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature

Abstract

    This study critically questions the PLS paradigm of Islamic banks in fair distribution of profits.PLS paradigm theoretically enforces that there should not be a significant difference between the returns offered to IAH and returns offered to shareholders. Smoothing of return can have a potential problem as IAH do not have any control over managerial decisions while banks owner equity is affected through absorption through displaced commercial risk. Therefore, this study analyzes the previous literature in a critical and systematic way to ascertain if Islamic banks are distributing profits in a realistic manner or there are some anomalies in the PLS paradigm of Islamic banks. Furthermore, the literature was analyzed critically to find out the associated factors and constraints that lead Islamic banks to impairment of PLS paradigm. Through analysis of the literature, smoothing of income and PDM is discovered in the empirical studies of different researchers.Furthermore, constraints to efficiently and effectively managing the fair distribution of profits have been identified in the literature. These constraints shape several factors, which are broadly categorized as banking characteristics, macroeconomic and financial environment, geographic and population characteristics; corporate and legal environment. A diagrammatic representation of constraints framework is suggested based on available literature. Furthermore, future directions for future research are provided at the end

    Profit Distribution Management, Profit and Loss Sharing, Income Smoothing, Constraints to PLS Model, Interest Rate

    (1) Qazi Sikandar Hayat
    Lecturer, Institute of Business and Leadership, Abdul Wali Khan University Mardan, KP, Pakistan
    (2) Brekhana Gul
    Lecturer, Department of Economics, Faculty of Business and Economics, Abdul Wali Khan University Mardan, KP, Pakistan
    (3) Muhammad Sohail Alam Khan
    Lecturer, Department of Economics, Faculty of Business and Economics, Abdul Wali Khan University Mardan, KP, Pakistan
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Cite this article

APA

    APA : Hayat, Q. S., Gul, B., & Khan, M. S. A. (2020). Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature. Global Social Sciences Review, V(III), 431-444. https://doi.org/10.31703/gssr.2020(V-III).46

CHICAGO

    CHICAGO : Hayat, Qazi Sikandar, Brekhana Gul, and Muhammad Sohail Alam Khan. 2020. "Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature." Global Social Sciences Review, V (III): 431-444 doi: 10.31703/gssr.2020(V-III).46

HARVARD

    HARVARD : HAYAT, Q. S., GUL, B. & KHAN, M. S. A. 2020. Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature. Global Social Sciences Review, V, 431-444.

MHRA

    MHRA : Hayat, Qazi Sikandar, Brekhana Gul, and Muhammad Sohail Alam Khan. 2020. "Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature." Global Social Sciences Review, V: 431-444

MLA

    MLA : Hayat, Qazi Sikandar, Brekhana Gul, and Muhammad Sohail Alam Khan. "Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature." Global Social Sciences Review, V.III (2020): 431-444 Print.

OXFORD

    OXFORD : Hayat, Qazi Sikandar, Gul, Brekhana, and Khan, Muhammad Sohail Alam (2020), "Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature", Global Social Sciences Review, V (III), 431-444

TURABIAN

    TURABIAN : Hayat, Qazi Sikandar, Brekhana Gul, and Muhammad Sohail Alam Khan. "Constraints Framework for Fair Profit Distribution in Partnerships for Islamic Deposits: A Critical Analysis of Literature." Global Social Sciences Review V, no. III (2020): 431-444. https://doi.org/10.31703/gssr.2020(V-III).46