Ancient Economics

[Pompieus]

Economics - there's a topic that will arouse everyones interest(!)

 

I have seen several papers that explain the collapse of ancient civilization by the restrictions on the free market imposed by guilds and the government - especially on agricultural goods (the main product of the ancient economy). Obviously the government was trying to make sure that the cities always had food available at reasonable prices to avoid civil disorder. The argument apparently is that these restrictions on prices made grain farming unremunerative and destroyed the exchange of manufactured goods from the town for foodstffs from the country; resulting in abandonment of the cities and self-sufficient manorialism in the country.

 

This seems suspiciously "Objectivist" to me. Isn't the low buying power of the working classes, due to low wages, caused in part at least by widespread slavery, way more important than any government or guild action? After all, the economy of the Middle ages had the same "moralistic" restrictions on pricing and usury as the Romans did - didn't it?

 

Besides Rostovstiev (very hard to find) does anyone know the important works on this? Any strong opinions?

Edited February 13, 2008 by Pompieus

[Kosmo]

It's true that roman empire economy had many restrictions. Some were created by Annona, the public supply service, by state interference in mining or beast gathering and by tributes in kind. Others were created by the influent profesional associations that acted as guilds.

I don't think that this actions were bad for the economy. In the East they were even stonger but the byzantines had a prosperous economy for a long time. Later capitalism in pre-industrial era had lots to do with state organized merchant companies, guild regulation etc. Free market started in mid XIX and state influence was and still is huge.

Romans never had a unified market because of difficult and expansive transport. They had interconnected local markets and the trade beetwen regions was reduced by diffusion of technologies. For example the italian wine lost the Gaul market when Gaul became a major wine producer. In a similar move glass making spreaded from Syria thru the empire because it was much cheaper to bring specialists and make glass on the spot then to carry it across continents.

 

Slavery was not a competions for the wage earners but an alternative in the conditions of a poorly developed labour market. Slavery was needed because they could not find man to work when and where they where necesary.

[Pompieus]

That's right. The Eastern economy continued until at least the 11th century. However, Steven Runciman says, the same sort of economic issues (viz government and social restrictions on profits from investments of various sorts) caused those with capital to invest it almost exclusively in land - displacing the smallholders and military settlers in asia minor thus "feudalizing" the empire (!?) I'm not sure I buy it...but there seems to be a comman thread between the 2nd century BC and the 3rd, 10th and 11th AD in the search for a safe way to invest capital which always ends up being land.

 

However, I can't agree that slavery has no effect on reducing the standard of living for workers. It happens everywhere it is allawed to exist - look at the American South.

[Kosmo]

I'm not sure that diverting capital from trade/manufacture to land it's a bad thing. In this type of economy there are few profitable investments.

 

American South was part of an industrial capitalist economic system and we can not compare it with a pre-industrial. Did massive slavery worsen the conditions of Murano glass workers in Venice? No, because slaves were not employed in high skill work. They did not "compete" on the same job. And of course glass workers were usually not employes but masters of their own bussines inherited in the family and guild members.

On the other hand the prospect of working in the Rio Tinto state mines would not be very appealing for a roman and force recruiting was necesary.

[CiceroD]

Did massive slavery worsen the conditions of Murano glass workers in Venice? No, because slaves were not employed in high skill work. They did not "compete" on the same job. And of course glass workers were usually not employes but masters of their own bussines inherited in the family and guild members.

On the other hand the prospect of working in the Rio Tinto state mines would not be very appealing for a roman and force recruiting was necesary.

 

We have a good deal of evidence that slaves were trained (especially greek ones) as secretaries.

Others were trained as cooks, hair dressers, special name-rememberers (nomenclatores) etc. Arent these all high skill jobs? Im not saying that there weren't any free workers, but if the rich had to pay people to pamper them there would have been far fewer on the Dole.

 

Economies are viewed by experts as proceeding in stages (Agricultural-Industrial- Services). On the face of it no there is nothing wrong with agriculture except that it is less profitable.

Putting too much capital in land would be bad for an "Urbanizing" Civilization

Edited February 14, 2008 by CiceroD

[Moonlapse]

My next history book purchase will be The Social and Economic History of the Hellenistic World by Michael Rostovtzeff. It's referenced quite a bit in the historical section of an economic text that I'm currently reading (Money, Bank Credit, and Economic Cycles by Jesus Huerta de Soto) and it looks to be an extensive resource. I'm not sure if this is the author you are referring to, but you can get used copies for about $35 - $50 on Amazon.

[M. Porcius Cato]

I have seen several papers that explain the collapse of ancient civilization by the restrictions on the free market imposed by guilds and the government - especially on agricultural goods (the main product of the ancient economy).

 

What papers?

[Kosmo]

We have a good deal of evidence that slaves were trained (especially greek ones) as secretaries.

Others were trained as cooks, hair dressers, special name-rememberers (nomenclatores) etc. Arent these all high skill jobs? Im not saying that there weren't any free workers, but if the rich had to pay people to pamper them there would have been far fewer on the Dole.

 

Economies are viewed by experts as proceeding in stages (Agricultural-Industrial- Services). On the face of it no there is nothing wrong with agriculture except that it is less profitable.

Putting too much capital in land would be bad for an "Urbanizing" Civilization

 

My example had the purpose to show that slavery does not always compete with good wages for workers.

 

We know a lot about roman slaves but very little about wage earners. We know that almost half of the days were holidays and we know that the working hours were few. In Rome at least during the empire the state gave them food, money, entretainment, public baths, fountains etc. That's why they often were not interested not even in becoming colonists less in a difficult job. I don't believe that a developed labour market existed in Antiquity.

[CiceroD]

Simply for my own edification,

 

Wasn't this dole system done away with by the Byzantines? I remember some quote about "If one shall not work then neither shall he eat". How did Constantinople manage to pull this off? or was there no dole in the provinces?

[caldrail]

We know a lot about roman slaves but very little about wage earners. We know that almost half of the days were holidays and we know that the working hours were few. In Rome at least during the empire the state gave them food, money, entretainment, public baths, fountains etc. That's why they often were not interested not even in becoming colonists less in a difficult job. I don't believe that a developed labour market existed in Antiquity.

'All roads lead to Rome' - An old saying which in their day meant that people were attracted to the big city to find gainful employment. Perhaps this was less true of the empire, as Augustus has begun the franchise system of colonies to extend his tax base and consolidate roman power (in his name of course). Rome had a considerable number of itinerant labourers, but there's also an attitude you find amongst romans that if they can get something for nothing, why not? I'm reminded of a story that Hadrian visited the baths one day. He spotted one man rubbing his back on a marble pillar. "What are you doing?" He asked. The man replied that he had no slave to scrape his back. Hadrian apparently rolled his eyes, clicked his fingers at his minions, and handed the man a few gold coins. "Here, go and buy yourself a slave...". The next day Hadrian returned to the baths only to find a multitude of 'slaveless' men rubbing their backs on any free surface.

 

You could argue the same thing would happen today, and given human nature, it probably would. But the point is that the romans did not have the work ethic we do today. They worked out of necessity, not because because it was manly or expected.

 

The labour market in Rome was organised up to a point but since it was all very entrepeneurial and often dependent on patronage, the labour market was also factional.

 

As for being colonists, it depended on who you were. A retired legionary may well jump at the chance to remain in the area he knew well, with a woman he also knew well, with an opportunity to acquire some land and settle down. For him, the chances of finding employment in Rome were no better than anyone else.

Edited February 16, 2008 by caldrail

[M. Porcius Cato]

I don't believe that a developed labour market existed in Antiquity.

 

Can you explain what you mean by a "developed labour market"? Certainly, there was a labor market -- free men bought and sold free labor, whether for agricultural production, transport, or management of slaves. On this see, Cato the Elder. What more is missing?

[Pompieus]

What papers?

 

As usual Macus Portius, you are quick to nail down an ambiguity - and rightly so. Unfortunately I was reading them on-line and can't find them now-d*%#@#!*x!!!!

 

I imagine anyones outlook on the change from urban-ancient civilization to rural-midieval civilization is going to depend to a large extent on their current position in the Marxian-Keynesian-Smithian-objectivist spectrum.

[Ursus]

Maybe I am being naive, but does one need a detailed primer from an established economic orthodoxy to explain this all? I always took it as a given that the chaos resulting from the collapse of a unified imperial society was sufficient on its own merits to create localized, agrarian society. A localized agrarian society is what most of western Europe had experienced before the Pax Romana - Iron Age peasants living in mud huts and hill forts under the service of some petty chief, whose main occupation was raiding the wealth of the neighboring petty chief. From that perspective, the biggest difference between pre-imperial Europe and post-imperial Europe was simply one of local religion and language being replaced by Catholicism and corrupted Latin.

[Pompieus]

True enough...but why did the classical, urban civilization decline? repeated pillage by barbarians and/or the imperial army? overtaxation? too much government regulation? not enough? Even in the Eastern half of the empire where the political institution survived, the cities declined in number and size. I just wondered what economic causes have been postulated for this.

[M. Porcius Cato]

True enough...but why did the classical, urban civilization decline? repeated pillage by barbarians and/or the imperial army? overtaxation? too much government regulation? not enough?

 

Diocletian's Edict on Prices, which threatened citizens with death for coming to a voluntary agreement on goods and services, was certainly immoral and unjust, and it must have had a negative economic effect as well. When prices are set artificially low, producers stop producing, leading to shortages. When prices are set artificially high, consumers economize by lowering their purchases of other goods. This is the basic law of supply-and-demand, which should be no more controversial than the law of gravity or evolution by natural selection.

 

Moreover, according to Gibson's analysis, the state had lavished the wealth of the state on economically unproductive churches and monestaries, thereby transferring support from the military to idle mouths that contributed nothing more to Rome than removing themselves from the gene pool. What could be controversial about the economic effects of such a policy? By removing money from the capital markets, the state must have made money less available for loan for commercial enterprises, thereby increasing the interest rate and reducing the likelihood of taking risks on overseas trade, new business ventures, and the like. Again, this is merely basic economics, which should be no more controversial than the law of gravity or evolution by natural selection.

 

What SHOULD be controversial, however, is whether the economic policy of the late empire was sufficient to cause the historical decline that was observed. In fact, the material evidence from archaeology depicts a high degree of luxury all over the empire UNTIL the barbarians invaded. Thus, rather than economic decline being sufficient to explain the fall of Rome, it seems instead to have contributed to the inability of the Empire to finance a sufficient defense against the barbarian hordes, which toppled Roman provinces in Europe, North Africa, the Aegean and Levant, and finally Asia over widely-spaced intervals of time. The timing of all this can't be explained simply by reference to economic factors alone.