Monday, February 20, 2012

Perfect information

Only God knows perfect information.

Classical is wrong when they underline the assumption that there is perfect information in the market.

Even though there is information in the market, it does not mean everything will be revealed by the companies. Therefore, we are actually having imperfect information in the market. 
 Due to this problem, what should we do?

That's why, we need to understand the real causes of economy crisis and effects. Financial institution, stock trading and bond create uncertainty in the market as they are framed by the interest rate and some sort of speculation activities. This is due to profit maximization orientation.

In micro perspective, the concept of triple bottom line need to be emphasized. Economics (profit), social and environment must be considered during the development and production process.

The problem is people have their own self-interest. Having self-interest doesn't mean it is bad totally. It needs to be liaised with the objective of shariah. Self-interest or group interest? Utilitarianism or universal principle?

No comments: