When in the 1990s I mentioned to Michael Crawford that I was planning a book on ancient money, he advised me to investigate one coinage, and look at one local monetary economy, before embarking on the larger project of money in classical antiquity. I took his advice, studied Ptolemaic coinage and money, and more than ten years later returned to the original plan. I learnt that any presumed ‘nature’ of ancient money is very different if you use different kinds of evidence, and that any single type of evidence provides a limited perspective. From the correspondence of Cicero, and the volumes of coinage calculated to have moved around the Roman empire, the ancient monetary economy strikes us as very advanced and widespread. In contrast, personal letters, tax receipts, bills and bank accounts surviving from Greco-Roman Egypt suggest that there was a huge discrepancy in economic behaviour between those who had a great deal and those who had very little money at their disposal. Greek and Roman authors, moreover, lead us to believe that outside the great cities and their imperial outreach people did not know money, living primitive lives in huts and woods, and bartering their goods in a natural economy. But archaeology tells a different story: coinage was present in remote places and most ‘barbarians’, too, had some form of money.

INTRODUCTION

If you consult an ordinary dictionary, you will find monetization defined as establishing something (e.g. gold or silver) as legal tender in a country. If legal tender had been a pervasive concept in antiquity, and if coins had been the only tender, monetization would then refer to the introduction of coinage. But when we consider that valuable objects and metal bullion, too, were tendered by custom or public approval, we find that monetization was not a process involving solely the establishment of coinage by governmental act. In this chapter we will explore monetization more broadly as the development of monetary institutions, intertwined as they were with the development of coinage. In the second chapter I shall compare a number of different cases and forms of monetization in the Greek and Roman world.

It is open to question whether it was economic or political institutions that brought into being money and coinage. The problem is linked to the major controversies in the debate over the ancient economy. Those who see a significant development of markets from an early period of classical antiquity onwards tend to link monetization to the transformation of a barter economy into a market economy. Those who believe that markets were relatively late developments in ancient history emphasize that monetization was a result of community building and state development.

INTRODUCTION

According to Moses Finley, the great number of weight standards and individual coin designs used throughout the Mediterranean impeded proper circulation of money, and in particular coinage. The fact that states showed little interest in removing these boundaries demonstrated that local rather than broader economic principles guided their monetary policies. What is more, the economic impact of coined money remained limited because of the political boundaries created by local weight standards and coin designs.

We know, however, that many cities adopted common weights and measures, or made their coinages more easily exchangeable by using the same weight standard for their principle coin. Every precious metal monetary system is based on a principal unit of weight (normally slightly lighter than the unit of metal weight itself). There is also a standard coin (stater) which represents a specific number of these units. In Greek poleis, for example, the stater could represent two, three or four drachmas of a different size. It is highly significant, therefore, that the Athenians in the sixth century seem to have changed their metal-weight system from the Aiginetan standard to one that scholars identify with the island of Euboia (Arist. Ath. Pol. 10.3). The change was not related to coinage, for coins were not minted in Athens at the time of Solon to whom the change was attributed in the fourth century bc. It did, however, affect the monetary units on the basis of which monetary exchange was conducted.

ATHENS AND OTHER GREEK POLEIS

Writing in fourth-century Athens, Aristotle had two explanations for the origins of coined money (nomisma). In the Politics he points to the intrinsic value of metals, and their use as coins in trade among people with no social or political connection (Pol. 1257a 31–8, quoted on p. 1). In the Ethics, by contrast, he suggests that coinage had its origin and principal function within communities. By convention (nomos), citizens had given value to legal tokens (nomismata) in order to achieve justice in exchange. These tokens compensated those who provided services to another citizen at precisely the value of the benefit produced for the exchanging partner. They thus provided the possibility of compensating each citizen for the different use value of their products:

INTRODUCTION

In post-war scholarship money has been approached almost exclusively within a secular framework of understanding. Religious meanings of money have not received any serious attention, not least because Aristotle, the most influential ancient authority on monetary history and theory, does not proclaim a particularly close connection between money, cult and ritual (see above, introduction and chapter 2). Temple finance tends to be dealt with in accounts of individual temples or ancient religion more generally, but is not well integrated into ancient economic history. However, the consecration of property, fines and tithes, and the thesauration of some or all of a collective's wealth in temples and shrines, suggest a strong interpenetration of political economics and sacred finance. In the classical city, moreover, a city's patron god had the important function of creating identity and trust in coinage, as well as adding force to commercial contracts backed up by oaths. Temples performed the function of guarding public and private contracts recorded on stone a role which before the Hellenistic period secular institutions were unable to fulfil.

It has been argued, furthermore, that, if not coinage itself, at any rate important conceptual preconditions for the emergence of money in the form of metal tokens developed in the context of cult practice. Bernhard Laum at the beginning of the twentieth century argued that the most important aspect of money was its function as a substitute. The idea of substitution was typical of ancient cult.

In this book I have concentrated on the economic consequences of money and coinage in classical antiquity. But it is well known that money does not just affect economies but is a collective signifier through which individuals and societies construe their identities and lives. Surprisingly, very little positive has ever been said about the social impact of money. Texts from Greco-Roman antiquity, too, express their anxieties about money. Already before the first coins were minted, Solon compared virtue with false (monetary) wealth. ‘Many bad men are rich, good men poor; but we will not exchange virtue for these men's wealth. For the one lasts, whereas the other belongs now to this man and now to that’ (Solon frg. 4 (Bergk)). Kreon proclaimed in Sophocles' Antigone that money was a force that destroyed cities, uprooted men from their homes, twisted good minds and set them to the most atrocious schemes (Ant. 295 ff.), while Plato associated contact with money with lying and deceit:

One of the surprising phenomena in world history is the success of money. Money is more easily lost than gained; it requires a host of laws, regulations and controls to work and have value; in the form of coinage it costs something to be produced; and – above all! – it makes people dependent on anonymous authorities such as governments, federal institutions and central banks. Money destabilizes wealth and social relationships, and transforms tangible, useful property into mere options for the future. While it has created immense riches for some, and reasonable well-being for many, it has also created more extreme forms of poverty and the most spectacular economic crises the world has ever seen. Rather less surprisingly, there has been much resistance to monetization, and many political thinkers whose views were influential in other respects had serious objections to the use of money.

There is the other side of the coin. As Aristotle in his imagined history of the origins of coinage writes:

INTRODUCTION

In order to substantiate both the propositions and reservations I have expressed in the previous chapter, I wish to present in the form of a case study the price developments in Egypt from the third to the first centuries bc. In the case of grain prices, a reasonable amount of information has survived, which permits investigation in serial form. The corpus of wheat prices from Ptolemaic Egypt comprises some 100 figures. Most belong to the period between c. 275 and c. 80 bc, that is, from the reign of Ptolemy II Philadelphos to the death of Ptolemy XII Soter II. Important periods of economic change during the early period of Ptolemaic rule under Ptolemy I Soter and the very end of this rule under Kleopatra VII are not represented in these data. Not all information, moreover, is equally useful for economic analysis, and several prices just duplicate each other. Moreover, despite the relative wealth of information, we have to bear in mind some fundamental problems.

The first problem addresses the question of generalization: Is our material representative of prices in Egypt as a whole? The largest proportion of Greek papyri containing price information comes from areas of Greek occupation in the Fayum and the adjacent areas of the Oxyrhynchite and Herakleopolite nomes in Lower and Middle Egypt. Although markets and coinage were not totally absent from the less Hellenized areas of Upper Egypt, levels of urbanization, population density and economic organization – in short, the conditions of price formation – varied considerably.

INTRODUCTION

The largest maritime loan known from Athens in the fourth century bc is 4,900 drachmas. The largest maritime loan attested in Roman Alexandria in the second century ad was equivalent to 1.75 million Attic drachmas. Pasion, the richest banker in classical Athens, is said to have had 300,000 drachmas on loan, which was by the standards of his time an enormous sum (Dem. 36.5). But Seneca in the second century ad allegedly had just in one province an equivalent of 10 million drachmas (40 million sesterces) in debt claims (Dio 62.2.1; cf. 61.10.3). Not only had the ancient economy expanded over the 600 years between the classical Greek and Roman imperial periods, but the financial resources that supported such expansion had also grown. In this chapter we will investigate the changing financial capacity of the ancient monetary economy, looking in particular at credit and other strategies that were adopted to increase the money supply.

For most of the last century scholars have insisted that the ancient economy was both dominated and limited by the use of cash. ‘Money was coin and nothing else’, Finley wrote in the Ancient Economy, and similar were the assumptions of leading historians of the Roman economy. Legal historians regarded it as a fundamental principle that sale was an exchange of goods for cash and that an equivalent to the consensual contract, which constitutes an enforceable agreement without the immediate exchange of goods for money, was unknown until the Roman period.