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Leadership through the Classics pp 289–304Cite as

The City-State of Ancient Athens as a Prototype for an Entrepreneurial and Managerial Society

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Abstract

In this paper we argue that a significant part of the wealth amassed by Athens in classical times emanated from the entrepreneurial incentives Athenians, rather consciously, instituted and applied in their city-state. To corroborate our view, we give a brief account of the political institutions and rules of governance of the city-state of Athens; we describe the economy within which entrepreneurs operated, and we explain the reasons why Athenians chose to establish an open society, based on international trade and incentives for almost everyone (including slaves) to pursue entrepreneurial activities. Lastly, we focus on a “protagonist of management science,” i.e. Xenophon, who developed explicitly the first principles and imperatives of managerial actions.

Anastassios D. Karayiannis

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Notes

  1. 1.

    For a detailed analysis of these arrangements as well as an extensive bibliography from which they derive, see Bitros and Karayiannis (2006, 2008, 2010) and Kyriazis and Karayiannis (2011).

  2. 2.

    Athenians regarded that the protection of the private property except being under a “statute law” was also a kind of “natural law” (Demosthenes, Against Aristocrates, 61). By adopting the institution of private property, the middle class grew significantly and this development helped the establishment of democracy (Aristotle, Politics, 1295b, 30–40).

  3. 3.

    For the extensive description of the judicial arrangements through which Athenians enforced fairness in business, see Kyriazis and Karayiannis (2011).

  4. 4.

    Isocrates (Antidosis); Demosthenes (Against Phaenippus).

  5. 5.

    For the Athenian system of paideia see Bitros and Karayiannis (2011).

  6. 6.

    For the high wealth level of the Athenian economy see Ober (2011).

  7. 7.

    An example in this regard is that of freedman Alcias (Lysias, On the Olive Stump, 10).

  8. 8.

    Aristophanes, in his comedies, mentions many small-scale industrial and trade occupations (see e.g. Birds, 488–495; Peace, 445–450, 543–550, 200–205, 1220–1225, 1240).

  9. 9.

    For examples on how demand and supply determined the prices of goods, see e.g. Aristophanes (Acharnians, 755–760, 60–65; Knights, 645–652); Engen (2001, 183); Harris (2002, 76).

  10. 10.

    See Lysias (Against the Corn Dealers); Aristotle (The Athenian Constitution, LI).

  11. 11.

    Aristotle (Nicomachean Ethics, 1133a–b) discusses the qualities of silver in the function of money in much detail.

  12. 12.

    For a detailed analysis of these banking activities see Isager and Hansen (1975), 90–98) and Cohen (1992, Chap. 5).

  13. 13.

    Isager and Hansen (1975, 76–81) and Cohen (1990) analyze the maritime risks and the insurance policies that were adopted at the time.

  14. 14.

    Engen (2001, 186–202) finds epigraphic evidence showing that import–export activities were conducted much like in our times and that the Athenians paid special tributes to traders for their services to the city.

  15. 15.

    See the descriptions of Andocides (On the Mysteries, 38); Aeschines (Against Timarchus, 124).

  16. 16.

    Demosthenes (Against Stephanus I, 31–34; Against Stephanus II, 17) gives an example from the sector of banking.

  17. 17.

    See e.g. Aeschines (Against Timarchus, 153); Hyperides (In Defense of Euxenippus, 36); Demosthenes (For Phormio, 8–9; Against Nausimachus, 25–26).

  18. 18.

    See Isocrates (Areopagiticus, 44–45; To Demonicus, 45; To Nicokles, 18; Antidosis, 159–160).

  19. 19.

    See e.g. Antiphon (Tetralogy I, b 12–13); Demosthenes (To Nausimachus, 25–27); Lycurgus (Against Leocratus, 139–140).

  20. 20.

    Plato and Aristotle were rather hostile toward the profit seeking activities of individuals which they considered to be a source of economic injustice and social destruction (see Karayiannis 1990, 21, 28–29).

  21. 21.

    It seems that the majority of metics who acted as entrepreneurs preferred activities with moveable assets such as bankers, shopkeepers and traders, because they did not have the right to be proprietors of agricultural land (see Humphreys 1978, 148).

  22. 22.

    Christesen (2003) presents evidence for the existence of income-maximizing economic rationalism in fourth century Athens with emphasis on silver mining and other risky undertakings with borrowed funds.

  23. 23.

    As Xenophon comments: “In other states [except Sparta], I suppose, all men make as much money as they can. One is a farmer, another ship-owner, another a merchant and others live by different handicrafts” (Constitution of the Lacedaemonians, vii.1; brackets added).

  24. 24.

    For an extensive analysis see Karayiannis (2003).

  25. 25.

    Xenophon, also noticed (Memorabilia, II.vii. 11–12) the useful services of those offering loanable funds (with or without interest) for the establishment of enterprise.

  26. 26.

    Xenophon draws the main similarities between the coordinating role of the entrepreneur-manager and that of the governor (e.g. Cyrus the Great) and the general in army (Cyropaedia, VI.ii, VIII.i.9–15; Oeconomicus, iv.5–7).

  27. 27.

    The role of entrepreneur as manager was not exercised exclusively by the owner. From available records it turns out that frequently owners of enterprises trained their slaves for this purpose; see e.g. Isocrates (Trapeziticus, 12); Demosthenes (Against Stephanus, 1–2). A well-known example, as we indicated previously, is the slave Phormio who managed the bank of Passion (Demosthenes, Against Stephanus I, 33, 36, 71).

  28. 28.

    Another means of undertaking risky activities, namely to increase the searching investments for the discovery of new silver ore, suggested by Xenophon (Ways and Means, iv.30–31), was through the establishment of a public enterprise. However, he questioned the efficiency of such a scheme by commenting: “what may well excite surprise is that the state, being aware that many private individuals are making money out of her [i.e. land] does not imitate them” (Ways and Means, iv.14; brackets added).

  29. 29.

    Such an entrepreneurial function was also described by Demosthenes (Against Dionysodorus, 9–10).

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Authors and Affiliations

  1. Department of Economics, Athens University of Economics and Business, 76 Patission St, Athens, 10434, Greece

    George C. Bitros

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  2. Anastassios D. Karayiannis
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  1. , Howe School of Technology Management, Stevens Institute of Technology, Castle Point on Hudson, Hoboken, 07030, New Jersey, USA

    Gregory P. Prastacos

  2. and Economics, Economic Cooperation and Development, University of International Business, Huixin Dongjie, Chaoyang District 10, Beijing, China, People's Republic

    Fuming Wang

  3. , Business Faculty, Higher Colleges of Technology, Women's Campus, Dubai, 16062, Utd.Arab.Emir.

    Klas Eric Soderquist

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Bitros, G.C., Karayiannis, A.D. (2012). The City-State of Ancient Athens as a Prototype for an Entrepreneurial and Managerial Society. In: Prastacos, G., Wang, F., Soderquist, K. (eds) Leadership through the Classics. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-32445-1_19

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