economic thought in the qur"àn and sunnah 83measures of crops, fish etc.) the contract is regarded as legitimate.
Thus it is what is called “sale of the uncertain”, or “Buyu al-
Gharar”, which was condemned by the Prophet (ibid.).It might be interesting to note that the awareness of market forces
and their effect on prices by caliphs has been demonstrated more
than once in Islamic history. During Caliph Umar’s reign (634–644),
as a result of a short of supply in al-Medìnah in around 639 A.C.
the prices increased substantially. The second caliph did not try to
fix the prices but instead instructed his viceroy in Egypt to send him
supplies to bring the prices down, which he did (Tuma, 1965).
Another example can be learned from the time when the caliph al-
Mansùr was selecting a site for his new city, Baghdad, in 767 A.C.
Al-Mansùr is reported to have said that he wanted a site where peo-
ple could earn a living, where prices could not be high or supplies
scarce, because if he resides where supplies could not be reached by
land or sea there would be scarcity, high prices and hardship for
the people (ibid.). This awareness of the Heads of State of the role
of market forces reflect an early recognition of the role of demand
and supply in determining prices with no need for state interven-
tion. Even when the state intervenes in particular circumstances when
the market is in a state of abnormality, a condition that requires
intervention as Imam ibn Taymìya advocated, such intervention is
not in negation of the recognition of the market forces. These forms
of intervention, as Tuma suggests, are not in conflict with the com-
petitive market structure or with competitive prices (ibid.) as long as
they aim at stabilizing prices. But, when the market is stable, prices
are determined in accordance with competitive market forces.
The state, however, has the duty of ensuring that the information
given in the market regarding the quantity and quality of exchanged
goods and services is sound and reliable. Without the reliability of
information the parties in the transactions are likely to reach wrong
conclusions and finalise transactions that may cause harm and lead
to injustice. Furthermore, confidence in the market has to prevail if
it is, with market forces, to function effectively and efficiently. The
surveillance role of the state will add to this confidence and help
enhance the exchange of economic activities. We will see later how
the subject of accountability, business governance and public duties
in Islam had attracted the attention of Muslim jurists in the early
fourteenth century and had lead to the emergence of specialized