WHY COINAGE? POLITICAL AND ECONOMIC ASPECTS

PETER VAN ALFEN

ANS SUMMER SEMINAR

2011

THE BIRTH OF COINAGE

Remains of the first mint at Sardis

Lydian electrum stater, c. 575 BC

POLEIS PRODUCING COINAGE BY 500 BC

HACKSILBER

EARLY LYDIAN ELECTRUM ISSUES

WHY COINAGE?POLITICAL VS. ECONOMIC SYSTEMS OF

INTERPRETATION

POLITICAL-coinage no more than a political phenomenon as a form of civic pride,

identity and self-representation

-expression of sovereignty; the “right of coinage”

-coinage a locus of internal (non-)elite conflict and moral economy

-coinage a tool in external hegemonic power relations

ECONOMIC-coinage a tool for meeting public debts

-coinage a source of revenue

ECONOMIES AND COINAGE

I. MONEY SUPPLY

A. Coinage

B. Bullion

C. Money Extension

1. Private: credit

2. Private: bank money

3. State: monetary manipulations (debasement, etc.)

ECONOMIES AND COINAGE FRACTIONAL RESERVE BANKING

Action Assets Liabilites Reserves

1Customer A deposits 100 paper

dollarsNone $100 in interest-bearing deposits 100 paper dollars

2 Bank loans $70 to Customer B IOUs worth $70 $100 in interest bearing deposits 30 paper dollars

3 Customer B deposits 70 paper dollars IOUs worth $70 $170 in interest-bearing deposits 100 paper dollars

4 Bank loans $49 to Customer C IOUs worth $119 $170 in interest-bearing deposits 51 paper dollars

5 Customer C deposits 49 paper dollars IOUs worth $119 $219 in interest-bearing deposits 100 paper dollars

ECONOMIES AND COINAGE

II. STATE INCOME AND EXPENDITURESA. Income (profit from coinage)

1. Fiduciarity

2. Commodification

B. Expenditures (public debts)

1. Military

2. Non-military

What is the relationship between the mint and the fisc?

ECONOMIES AND COINAGE

III. (POLITICAL) ECONOMIES: INTERNALA. For the public good? Small change/deflation

1. Private responses: private coinage

B. Internal regulation: legal tender

 IV. (POLITICAL) ECONOMIES: EXTERNALA. International currencies

B. Hegemonic coinage

C. Cooperative coinage

AGAIN: WHY COINAGE?

Let us think of coinage as a collective action problem involving real people.

The production of coinage is a cooperative project requiring a coordinated series of communal decisions:

-Why coinage? Why now?

-What metal?

-What weight standard?

-What iconography?

-How many?

-Who decides and why?

FRAMEWORKS AND QUESTIONSPROBLEMS OF METHODOLOGY

INDUCTIVE-The framing of problems within anthropological or literary theories in order

to approach the material evidence of coinage through the literary representation of coinage.

DEDUCTIVE-The focus on single mints to produce a die study, which provides the relative

chronology of the various series and the statistical basis for determining the quantity of coins produced, plus technical information on weight standards and die axis preferences.

FRAMEWORK AND QUESTIONSA POLITICAL ECONOMY OF (ARCHAIC GREEK) COINAGE

A “MIDDLE RANGE” METHODOLOGICAL FRAMEWORK

-A framework integrating theory and empirical observations, e.g., the combined use of political and economic theories and technical numismatic study (e.g., die, hoard, metallurgical studies, etc.)

SAMPLE QUESTIONS-How did this particular group of people come to think coinage was important

(and where did they obtain their information?)

-How did their governing structures help or hinder the alignment of interests?

-How did they implement and enforce their decisions?

-How successful was the outcome?

THE THEORETICAL TOOLKIT:POLITICAL

-PUBLIC CHOICE THEORY: to explore rationality and the behavior of self-interested political actors and agents

-BARGAINING THEORY: to understand sources of inefficiencies in reaching agreements

-ELITE THEORY: to understand power distributions

-NETWORK THEORY: to trace the organization of information and loyalties

-INSTITUTIONS THEORY: to appreciate how actors and agents shape institutions and are shaped by them

THE THEORETICAL TOOLKIT:ECONOMIC

-(NEO)CLASSICAL: to map supply/demand and price formation

-MARXIAN: to understand the modes of production and consumption, and the formation of value

-(NEO)INSTITUTIONAL: to understand the role of transaction costs, property rights, rule of law, and path dependency

-ECONOMIC SOCIOLOGY: to understand the role of social networks and social capital, trust, and collective action

-ECONOMIC ANTHROPOLOGY: provides cross cultural comparanda on value formation, embeddedness, and (in)formal economies

PROBLEM:COINS AS PUBLIC GOODS, CLUB GOODS, OR PRIVATE

GOODS?

PUBLIC GOODS-Non-rivalrous and non-excludable. Non-rivalry means that consumption of

the good by one individual does not reduce availability of the good for consumption by others; and non-excludability that no one can be effectively excluded from using the good (e.g., national defense, air).

CLUB GOODS-Non-rivalrous, but excludable (e.g., golf courses, cinemas).

PRIVATE GOODS-Rivalrous and excludable (e.g., private property).

PROBLEM: DISPERSED AUTHORITIES?

WALWET (ALYTTES)

LYDIA, EL 1/3 STATER, C. 575 BCE

PROBLEM: DISPERSED AUTHORITIES?

“I am the semis of Phanes”

IONIA, EPHESUS?, C. 600 BCE

EL STATER

PROBLEM: COINAGE AND IDENTITY

Ionia, unknown mint, c. 600 BCE

EL hekte

PROBLEM: SOCIAL NETWORKS AND COINAGETHE DEVELOPMENT OF WIDESPREAD TRUST

PROBLEM: ALIGNMENT OF INTERESTSTHE DEVELOPMENT OF CIVIC COIN MONOPOLIES

PROBLEM: COINAGE AS INTELLECTUAL PROPERTYNIKOPHON’S NOMOS (375/4 BC)(SEG 26.72)

1) dokimon (prototype)

2) ksenikon…ekhon…kharaktera

toi Attikoi (imitation)

3) hypokhalkon (counterfeit)

CASE STUDY 1: LESBOSEFFICIENT COOPERATION

Methymna, AR stater, c. 500 BCE

CASE STUDY 1: LESBOSMytilene-Phokaia Cooperative EL hektai

CASE STUDY 1: LESBOSEFFICIENT COOPERATION

Lesbos, uncertain mint(s), c. 500 BCE

Billon staters

CASE STUDY 2: SAMOS, KLAZOMENAI, IALYSOS

INEFFICIENT COOPERATION/HEGEMONIC ACTION

CASE STUDY 3: EUBOIAEFFICIENT NON-COOPERATION

Tetradrachm of Eretria Tetradrachm of Chalcis