3. Contracts

By admin, June 23, 2009 11:36 am

The third important element is the revival of contracts such as profit-and-loss sharing, trade investment contracts, and partnership manufacturing contracts. This must be preceded by the identification of the wrong and unjust modes of contracting in order to avoid them, e.g. undercutting, regrating, engrossing, forestalling and usury. We have seen in Aisha Bewley’s magisterial essay that Venice in its hey-day and Ottoman society were two examples of societies that were funded by profit-and-loss sharing investment in trade contracts. Thus, these contracts as proposed here are not experimental innovations thought up by idealistic dreamers – we cannot afford the endless cycle of idealism followed by disillusionment – but taken direct from civilisations known to have thrived for centuries on the practice of non-usurious trading modalities.

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