Comparative Analysis of the Theoretical Foundations of Central Bank Independence in Conventional Economics and Islamic Economics

The central bank, as an institution that directly controls the monetary system of the country, can also pursue goals such as managing interest rates, volume of currency, inflation, unemployment and even income distribution. In some countries (like Iran) it functions as the part of the government and in some other countries the central bank is independent and follows its macro-policies. According to a common belief in economics, central bank independence plays a positive role in fulfilling its objectives and duties. The main hypothesis of this study is that, according to Islamic principles, we can develop a practical model of this independence. In this study we have used comparative method. The results show that based on the Islamic economic principles and its decrees about justice and insistence on preventing measurement unit distortion, we can apply the above model