Roman economy

Total GDP around 1 AD for various regions of the Roman Empire

The history of the Roman economy covers the period of the Roman Republic and the Roman Empire. Recent research has led to a positive reevaluation of the size and sophistication of the Roman economy. Moses Finley was the chief proponent of the primitivist view that the Roman economy was "underdeveloped and underachieving," characterized by subsistence agriculture; urban centres that consumed more than they produced in terms of trade and industry; low-status artisans; slowly developing technology; and a "lack of economic rationality." Current views are more complex. Territorial conquests permitted a large-scale reorganization of land use that resulted in agricultural surplus and specialization, particularly in north Africa. Some cities were known for particular industries or commercial activities, and the scale of building in urban areas indicates a significant construction industry. Papyri preserve complex accounting methods that suggest elements of economic rationalism, and the Empire was highly monetized. Although the means of communication and transport were limited in antiquity, transportation in the 1st and 2nd centuries expanded greatly, and trade routes connected regional economies. The supply contracts for the army, which pervaded every part of the Empire, drew on local suppliers near the base (castrum), throughout the province, and across provincial borders. The Empire is perhaps best thought of as a network of regional economies, based on a form of "political capitalism" in which the state monitored and regulated commerce to assure its own revenues. Economic growth, though not comparable to modern economies, was greater than that of most other societies prior to industrialization.

Socially, economic dynamism opened up one of the avenues of social mobility in the Roman Empire. Social advancement was thus not dependent solely on birth, patronage, good luck, or even extraordinary ability. Although aristocratic values permeated traditional elite society, a strong tendency toward plutocracy is indicated by the wealth requirements for census rank. Prestige could be obtained through investing one's wealth in ways that advertised it appropriately: grand country estates or townhouses, durable luxury items such as jewels and silverware, public entertainments, funerary monuments for family members or coworkers, and religious dedications such as altars. Guilds (collegia) and corporations (corpora) provided support for individuals to succeed through networking, sharing sound business practices, and a willingness to work.

Currency and banking

See also: Roman currency and Roman finance

Currency denominations

• 27 BC–AD 212:
  1 gold aureus (1/40 lb. of gold, devalued to 1/50 lb. by 212)
  = 25 silver denarii
  = 100 bronze sestertii
  = 400 copper asses
• 294–312:
  1 gold aureus solidus (1/60 lb. of gold)
  = 10 silver argentei
  = 40 bronze folles
  = 1,000 debased metal denarii
• 312 onwards:
  1 gold solidus (1/72 lb.)
  = 24 silver siliquae
  = 180 bronze folles

The early Empire was monetized to a near-universal extent, in the sense of using money as a way to express prices and debts. The sestertius (plural sestertii, English "sesterces", symbolized as HS) was the basic unit of reckoning value into the 4th century, though the silver denarius, worth four sesterces, was used also for accounting beginning in the Severan dynasty. The smallest coin commonly circulated was the bronze as (plural asses), one-fourth sestertius. Bullion and ingots seem not to have counted as pecunia, "money," and were used only on the frontiers for transacting business or buying property. Romans in the 1st and 2nd centuries counted coins, rather than weighing them—an indication that the coin was valued on its face, not for its metal content. This tendency toward fiat money led eventually to the debasement of Roman coinage, with consequences in the later Empire. The standardization of money throughout the Empire promoted trade and market integration. The high amount of metal coinage in circulation increased the money supply for trading or saving.

Rome has no central bank, and regulation of the banking system was minimal. Banks of classical antiquity typically kept less in reserves than the full total of customers' deposits. A typical bank had fairly limited capital, and often only one principal, though a bank might have as many as six to fifteen principals. Seneca assumes that anyone involved in commerce needs access to credit.

Solidus issued under Constantine II, and on the reverse Victoria, one of the last deities to appear on Roman coins, gradually transforming into an angel under Christian rule

A professional deposit banker (argentarius, coactor argentarius, or later nummularius) received and held deposits for a fixed or indefinite term, and lent money to third parties. The senatorial elite were involved heavily in private lending, both as creditors and borrowers, making loans from their personal fortunes on the basis of social connections. The holder of a debt could use it as a means of payment by transferring it to another party, without cash changing hands. Although it has sometimes been thought that ancient Rome lacked "paper" or documentary transactions, the system of banks throughout the Empire also permitted the exchange of very large sums without the physical transfer of coins, in part because of the risks of moving large amounts of cash, particularly by sea. Only one serious credit shortage is known to have occurred in the early Empire, a credit crisis in 33 AD that put a number of senators at risk; the central government rescued the market through a loan of 100 million HS made by the emperor Tiberius to the banks (mensae). Generally, available capital exceeded the amount needed by borrowers. The central government itself did not borrow money, and without public debt had to fund deficits from cash reserves.

Emperors of the Antonine and Severan dynasties overall debased the currency, particularly the denarius, under the pressures of meeting military payrolls. Sudden inflation during the reign of Commodus damaged the credit market. In the mid-200s, the supply of specie contracted sharply. Conditions during the Crisis of the Third Century—such as reductions in long-distance trade, disruption of mining operations, and the physical transfer of gold coinage outside the empire by invading enemies—greatly diminished the money supply and the banking sector by the year 300. Although Roman coinage had long been fiat money or fiduciary currency, general economic anxieties came to a head under Aurelian, and bankers lost confidence in coins legitimately issued by the central government. Despite Diocletian's introduction of the gold solidus and monetary reforms, the credit market of the Empire never recovered its former robustness.

Mining and metallurgy

Main article: Roman metallurgy

See also: Mining in Roman Britain

Landscape resulting from the ruina montium mining technique at Las Médulas, Roman Spain, one of the most important gold mines in the Roman Empire

The main mining regions of the Empire were Spain (gold, silver, copper, tin, lead); Gaul (gold, silver, iron); Britain (mainly iron, lead, tin), the Danubian provinces (gold, iron); Macedonia and Thrace (gold, silver); and Asia Minor (gold, silver, iron, tin). Intensive large-scale mining—of alluvial deposits, and by means of open-cast mining and underground mining—took place from the reign of Augustus up to the early 3rd century AD, when the instability of the Empire disrupted production. The gold mines of Dacia, for instance, were no longer available for Roman exploitation after the province was surrendered in 271. Mining seems to have resumed to some extent during the 4th century.

World production of lead, estimated from Greenland ice cores, peaked in the 1st century AD, and strongly declined thereafter. World production would only surpass Roman levels in the middle of the 18th century.

Hydraulic mining, which Pliny referred to as ruina montium ("ruin of the mountains"), allowed base and precious metals to be extracted on a proto-industrial scale. The total annual iron output is estimated at 82,500 tonnes, while the similarly populous Han China, where the state prohibited private ironworks, produced around 5,000 t. Copper was produced at an annual rate of 15,000 t, and lead at 80,000 t, both production levels unmatched until the Industrial Revolution; Spain alone had a 40 percent share in world lead production. The high lead output was a by-product of extensive silver mining which reached 200 t per annum. At its peak around the mid-2nd century AD, the Roman silver stock is estimated at 10,000 t, five to ten times larger than the combined silver mass of medieval Europe and the Caliphate around 800 AD. As an indication of the scale of Roman metal production, lead pollution in the Greenland ice sheet quadrupled over its prehistoric levels during the Imperial era, and dropped again thereafter.

The invention and widespread application of hydraulic mining, namely hushing and ground-sluicing, aided by the ability of the Romans to plan and execute mining operations on a large scale, allowed various base and precious metals to be extracted on a proto-industrial scale only rarely, if ever, matched until the Industrial Revolution. The most common fuel by far for smelting and forging operations, as well as heating purposes, was wood and particularly charcoal, which is nearly twice as efficient. In addition, coal was mined in some regions to a fairly large extent: Almost all major coalfields in Roman Britain were exploited by the late 2nd century AD, and a lively trade along the English North Sea coast developed, which extended to the continental Rhineland, where bituminous coal was already used for the smelting of iron ore.

Annual metal production in metric tons

	Output per annum	Comment
Iron	82,500 t	Based on "conservative estimate" of iron production at 1.5 kg per head, assuming a population size of 55m, while the similarly populous Han China, where the state prohibited private ironworks, produced around 5,000 t.
Copper	15,000 t	Largest preindustrial producer
Lead	80,000 t	Largest preindustrial producer
Silver	11,200 t	At its peak around the mid-2nd century AD, Roman stock is estimated at 10,000 t, five to ten times larger than the combined silver mass of medieval Europe and the Caliphate around 800 AD.
Gold	11,119 t	Production in Asturia, Callaecia, and Lusitania (all Iberian Peninsula) alone

Transportation and communication

See also: Roman roads

Gallo-Roman relief depicting a river boat transporting wine barrels, an invention of the Gauls that came into widespread use during the 2nd century; above, wine is stored in the traditional amphorae, some covered in wicker

The Roman Empire completely encircled the Mediterranean, which they called "our sea" (mare nostrum). Roman sailing vessels navigated the Mediterranean as well as the major rivers of the Empire, including the Guadalquivir, Ebro, Rhône, Rhine, Tiber and Nile. Transport by water was preferred where possible, and moving commodities by land was more difficult. Vehicles, wheels, and ships indicate the existence of a great number of skilled woodworkers.

Land transport utilized the advanced system of Roman roads. The in-kind taxes paid by communities included the provision of personnel, animals, or vehicles for the cursus publicus, the state mail and transport service established by Augustus. Relay stations were located along the roads every seven to twelve Roman miles, and tended to grow into a village or trading post. A mansio (plural mansiones) was a privately run service station franchised by the imperial bureaucracy for the cursus publicus. The support staff at such a facility included muleteers, secretaries, blacksmiths, cartwrights, a veterinarian, and a few military police and couriers. The distance between mansiones was determined by how far a wagon could travel in a day. Mules were the animal most often used for pulling carts, travelling about 4 mph. As an example of the pace of communication, it took a messenger a minimum of nine days to travel to Rome from Mainz in the province of Germania Superior, even on a matter of urgency. In addition to the mansiones, some taverns offered accommodations as well as food and drink; one recorded tab for a stay showed charges for wine, bread, mule feed, and the services of a prostitute.

Trade and commodities

See also: Roman commerce and Indo-Roman trade and relations

Roman provinces traded among themselves, but trade extended outside the frontiers to regions as far away as China and India. The main commodity was grain. Chinese trade was mostly conducted overland through middle men along the Silk Road; Indian trade, however, also occurred by sea from Egyptian ports on the Red Sea. Also traded were olive oil, various foodstuffs, garum (fish sauce), slaves, ore and manufactured metal objects, fibres and textiles, timber, pottery, glassware, marble, papyrus, spices and materia medica, ivory, pearls, and gemstones.

Though most provinces were capable of producing wine, regional varietals were desirable and wine was a central item of trade. Shortages of vin ordinaire were rare. The major suppliers for the city of Rome were the west coast of Italy, southern Gaul, the Tarraconensis region of Spain, and Crete. Alexandria, the second-largest city, imported wine from Laodicea in Syria and the Aegean. At the retail level, taverns or speciality wine shops (vinaria) sold wine by the jug for carryout and by the drink on premises, with price ranges reflecting quality.

Labour and occupations

Workers at a cloth-processing shop, in a painting from the fullonica of Veranius Hypsaeus in Pompeii

Inscriptions record 268 different occupations in the city of Rome, and 85 in Pompeii. Professional associations or trade guilds (collegia) are attested for a wide range of occupations, including fishermen (piscatores), salt merchants (salinatores), olive oil dealers (olivarii), entertainers (scaenici), cattle dealers (pecuarii), goldsmiths (aurifices), teamsters (asinarii or muliones), and stonecutters (lapidarii). These are sometimes quite specialized: one collegium at Rome was strictly limited to craftsmen who worked in ivory and citrus wood.

Work performed by slaves falls into five general categories: domestic, with epitaphs recording at least 55 different household jobs; imperial or public service; urban crafts and services; agriculture; and mining. Convicts provided much of the labour in the mines or quarries, where conditions were notoriously brutal. In practice, there was little division of labour between slave and free, and most workers were illiterate and without special skills. The greatest number of common labourers were employed in agriculture: in the Italian system of industrial farming (latifundia), these may have been mostly slaves, but throughout the Empire, slave farm labour was probably less important than other forms of dependent labour by people who were technically not enslaved.

Textile and clothing production was a major source of employment. Both textiles and finished garments were traded among the peoples of the Empire, whose products were often named for them or a particular town, rather like a fashion "label". Better ready-to-wear was exported by businessmen (negotiatores or mercatores) who were often well-to-do residents of the production centres. Finished garments might be retailed by their sales agents, who travelled to potential customers, or by vestiarii, clothing dealers who were mostly freedmen; or they might be peddled by itinerant merchants. In Egypt, textile producers could run prosperous small businesses employing apprentices, free workers earning wages, and slaves. The fullers (fullones) and dye workers (coloratores) had their own guilds. Centonarii were guild workers who specialized in textile production and the recycling of old clothes into pieced goods.

GDP and income distribution

For more details on this topic, see Roman economy § Gross domestic product.

Economic historians vary in their calculations of the gross domestic product of the Roman economy during the Principate. In the sample years of 14, 100, and 150 AD, estimates of per capita GDP range from 166 to 380 HS. The GDP per capita of Italy is estimated as 40 to 66 percent higher than in the rest of the Empire, due to tax transfers from the provinces and the concentration of elite income in the heartland.

In the Scheidel–Friesen economic model, the total annual income generated by the Empire is placed at nearly 20 billion HS, with about 5 percent extracted by central and local government. Households in the top 1.5 percent of income distribution captured about 20 percent of income. Another 20 percent went to about 10 percent of the population who can be characterized as a non-elite middle. The remaining "vast majority" produced more than half of the total income, but lived near subsistence. All cited economic historians stress the point that any estimate can only be regarded as a rough approximation to the realities of the ancient economy, given the general paucity of surviving pertinent data.

Estimates of Roman per-capita and total GDP

Unit		Goldsmith 1984	Hopkins 1995/96	Temin 2006	Maddison 2007	Bang 2008	Scheidel/Friesen 2009	Lo Cascio/Malanima 2009
GDP per capita in	Sesterces	HS 380	HS 225	HS 166	HS 380	HS 229	HS 260	HS 380
	Wheat equivalent	843 kg	491 kg	614 kg	843 kg	500 kg	680 kg	855 kg
	1990 Int$	–	–	–	$570	–	$620	$940
Population (Approx. year)		55m (14 AD)	60m (14 AD)	55m (100 AD)	44m (14 AD)	60m (150 AD)	70m (150 AD)	– (14 AD)
Total GDP in	Sesterces	HS 20.9bn	HS 13.5bn	HS 9.2bn	HS 16.7bn	HS 13.7bn	~HS 20bn	–
	Wheat equivalent	46.4 Mt	29.5 Mt	33.8 Mt	37.1 Mt	30 Mt	50 Mt	–
	1990 Int$	–	–	–	$25.1bn	–	$43.4bn	–
"–" indicates unknown value.

A ^ Decimal fractions rounded to the nearest tenth. Italic numbers not directly given by the authors; they are obtained by multiplying the respective value of GDP per capita by estimated population size.

Maddison's breakdown per region (14 AD)

Unit	Roman Europe	Roman Asia	Roman Africa	Roman Empire
NDI per capita (in 1990 Int$)	593	550	541	570
Population (in m)	23.1	12.2	8.7	44
Total NDI (in m 1990 Int$)	13,689	6,710	4,710	25,109

Angus Maddison is the only economist cited who offers a detailed breakdown of the national disposable income (NDI) of the various parts of the Roman Empire. His "highly provisional" estimate (see right) relies on a low-count of the Roman population of only 44 million at the time of the death of Augustus in 14 AD. Italia is considered to have been the richest region, due to tax transfers from the provinces and the concentration of elite income in the heartland; its NDI per capita is estimated at having been between 40% and 66% higher than in the rest of the empire. The European NDI per capita was higher than in the Asian and African provinces if Italy is included, but without it lower. The Hellenistic provinces (Greece, Asia Minor, Syria, Egypt) were about 20% wealthier than their mostly Latin-speaking western counterparts, but again Italia, which was not administered as a province, enjoyed a higher per capita income than any one of them.

See also

Economic sectors

• Roman commerce
• Roman finance
• Slavery in ancient Rome

Provinces

• Roman Britain: Trade and economy
• Economy of Hispania

Related economies

• Ancient Greek economy
• Byzantine economy
• Economy of Ancient China

Sources

• Bang, Peter Fibiger (2008): The Roman Bazaar: A Comparative Study of Trade and Markets in a Tributary Empire, Cambridge University Press, ISBN 0-521-85532-2, pp. 86–91
• Bang, Peter Fibiger (2009). "The Ancient Economy and New Institutional Economics". The Journal of Roman Studies 99: 194–206. doi:10.3815/007543509789744783. 
• Callataÿ, François de (2005). "The Graeco-Roman Economy in the Super Long-Run: Lead, Copper, and Shipwrecks". Journal of Roman Archaeology 18: 361–372. 
• Cech, Brigitte (2010): Technik in der Antike, Wissenschaftliche Buchgesellschaft, Darmstadt, ISBN 978-3-8062-2080-3
• Craddock, Paul T. (2008): "Mining and Metallurgy", in: Oleson, John Peter (ed.): The Oxford Handbook of Engineering and Technology in the Classical World, Oxford University Press, ISBN 978-0-19-518731-1, pp. 93–120
• Goldsmith, Raymond W. (1984). "An Estimate of the Size and Structure of the National Product of the Early Roman Empire". Review of Income and Wealth 30 (3): 263–288. doi:10.1111/j.1475-4991.1984.tb00552.x. 
• Healy, John F. (1978): Mining and Metallurgy in the Greek and Roman World, Thames and Hudson, London, ISBN 0-500-40035-0
• Hong, Sungmin; Candelone, Jean-Pierre; Patterson, Clair C.; Boutron, Claude F. (1994). "Greenland Ice Evidence of Hemispheric Lead Pollution Two Millennia Ago by Greek and Roman Civilizations". Science 265 (5180): 1841–1843. doi:10.1126/science.265.5180.1841. PMID 17797222. 
• Hong, Sungmin; Candelone, Jean-Pierre; Patterson, Clair C.; Boutron, Claude F. (1996). "History of Ancient Copper Smelting Pollution During Roman and Medieval Times Recorded in Greenland Ice". Science 272 (5259): 246–249. doi:10.1126/science.272.5259.246. 
• Hopkins, Keith (1980). "Taxes and Trade in the Roman Empire (200 B.C.–A.D. 400)". The Journal of Roman Studies 70: 101–125. doi:10.2307/299558. 
• Hopkins, Keith (1995/6): "Rome, Taxes, Rents, and Trade", Kodai, Vol. 6/7, pp. 41–75
• Lo Cascio, Elio; Malanima, Paolo (2009). "GDP in Pre-Modern Agrarian Economies (1–1820 AD). A Revision of the Estimates". Rivista di storia economica 25 (3): 391–420. 
• Maddison, Angus (2007): "Contours of the World Economy, 1–2030 AD. Essays in Macro-Economic History", Oxford University Press, ISBN 978-0-19-922721-1
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• Scheidel, Walter (April 2006): Population and Demography, Princeton/Stanford Working Papers in Classics, Version 1.0
• Scheidel, Walter; Friesen, Steven J. (2009). "The Size of the Economy and the Distribution of Income in the Roman Empire". The Journal of Roman Studies 99: 61–91. doi:10.3815/007543509789745223. 
• Settle, Dorothy M.; Patterson, Clair C. (1980). "Lead in Albacore: Guide to Lead Pollution in Americans". Science 207 (4436): 1167–1176. doi:10.1126/science.6986654. 
• Sim, David; Ridge, Isabel (2002): Iron for the Eagles. The Iron Industry of Roman Britain, Tempus, Stroud, Gloucestershire, ISBN 0-7524-1900-5
• Smith, A. H. V. (1997). "Provenance of Coals from Roman Sites in England and Wales". Britannia 28: 297–324. doi:10.2307/526770. 
• Temin, Peter (2006): "Estimating GDP in the Early Roman Empire", Lo Cascio, Elio (ed.): Innovazione tecnica e progresso economico nel mondo romano, Edipuglia, Bari, ISBN 978-88-7228-405-6, pp. 31–54
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Further reading

• Bowman, A. K. and Wilson, A. I. (eds) (2009), Quantifying the Roman Economy: Methods and Problems, Oxford Studies in the Roman Economy 1. Oxford University Press, Oxford
• Bowman, A. K. and Wilson, A. I. (eds) (2012), Settlement, Urbanisation and Population, Oxford Studies in the Roman Economy 2. Oxford University Press, Oxford
• Scheidel, Walter; Morris, Ian; Saller, Richard, eds. (2007): The Cambridge Economic History of the Greco-Roman World, Cambridge University Press, ISBN 978-0-521-78053-7
• Temin, Peter (2006). "The Economy of the Early Roman Empire". Journal of Economic Perspectives 20 (1): 133–151. doi:10.1257/089533006776526148. ISSN 0895-3309. 

External links

• The Oxford Roman Economy Project