Balanced Financial Structure the Appropriate Financial Structure for Iran

Considering the relationship between the real and financial sectors of the economy, one issue that has engaged the minds of economists and financial specialists is discovery of a maximum efficiency financial structure in the relevant economic system. In most countries, including first world countries, the Financial system is the basis of banking /or of market. However, in practice, this distinction has gradually blurred. For this reason, some believe that instead of focusing on this issue, what must be concentrated upon are the legal system and the resultant financial adjustments. This paper aims to demonstrate that, in accordance with Islamic teachings and global experience, a balanced combination of financial structure is appropriate for Iran. Utilizing a specific perspective on money and the market, considering the nature of religious contracts, and drawing on experience gained by Iran’s interest-free banking system, this paper also intends to present a financial model for Iran that may be able to mitigate the problems in the country’s financial system.