Abstract
Neolithic and Bronze Age economies operated mainly on credit. Because of the time gap between planting and harvesting, few payments were made at the time of purchase. When Babylonians went to the local alehouse, they did not pay by carrying grain around in their pockets. They ran up a tab to be settled at harvest time on the threshing floor. The ale women who ran these “pubs” would then pay most of this grain to the palace for consignments advanced to them during the crop year. These payments were financial in character, not on-the-spot barter-type exchange. As a means of payment, the early use of monetized grain and silver was mainly to settle such debts. This monetization was not physical; it was administrative and fiscal. The paradigmatic payments involved the palace or temples, which regulated the weights, measures, and purity standards necessary for money to be accepted. Their accountants that developed money as an administrative tool for forward planning and resource allocation, and for transactions with the rest of the economy to collect land rent and assign values to trade consignments, which were paid in silver at the end of each seafaring or caravan cycle.
This is a preview of subscription content, log in via an institution.
References
Balmuth M (1967) Monetary forerunners of coinage in Phoenicia and Palestine in Antiquity. In: Kindler A (ed) The patterns of monetary development in Phoenicia and Palestine in Antiquity, Jerusalem
Balmuth M (1971) Remarks on the appearance of the earliest coins. In: Mitten DG, Pedley JG, Scott JA (eds) Studies presented to George M. A. Hanfmann, Cambridge, MA, pp 1–7
Bell SA, Nell EJ (eds) (2003) The state, the market and the euro: chartalism versus metallism in the theory of money. Edward Elgar, Cheltanham, pp 1–25
Berriman AE (1953) Ancient Metrology (London: J. M. Dent & Sons)
Bogaert R (1966) Les Origines Antiques de la Banque de Depôt. Sijthoff, Leiden
Bongenaar ACVM (ed) (2000) Interdependency of institutions and private entrepreneurs. MOS studies, vol 2. Nederlands Institut voor het Nabije Oosten, Istanbul
Charpin D (1987) Les Decréts Royaux a l’Epoque Paleo-babylonienne, à Propos d’un Ouvrage Recent. AfO 34:36–44
Charpin D (1990) Les Edits de ‘Restauration’ des Rois Babyloniens et leur Application. In: Nicolet C (ed) Du Pouvoir dans L’Antiquite: Mots et Realities. Droz, Geneva, pp 13–24
Charpin D (1998) Les prêteurs et la palais: Les édits de mîšharum des rois de Babylone et leurs traces dans les archives privées. In: Bongenaar, ACVM (ed) Interdependency of institutions and private entrepreneurs (proceedings of the second MOS symposium, Leiden 1998), Nederlands Historisch-Archaeologisch Institute, Te Istanbul, 2000, pp 185–211
Cripps EL (2017) The structure of prices in the neo-Sumerian economy (I). Silver Price Ratios, Barley. http://cdli.ucla.edu/?q=cuneiform-digital-library-preprints
Dalton G (1965) Primitive money. Am Anthropol 67:44–65
Dercksen JG (ed) (1999) Trade and finance in ancient Mesopotamia. MOS studies, vol 1 [Leiden 1997]. Nederlands historisch-Archaelogisch Instituut, Istanbul
Dercksen et al (2016) “Kaspum lasqul, ‘Let me weigh out the silver.’ Mesopotamian and Anatolian Weights during the Old Assyrian Period,” in Kleber and Pirngruber (eds): 13–25. K. Kleber and R. Pirngruber (eds) (2016), Silver, Money and Credit. A Tribute to Robertus J. van der Spek on Occasion of his 65th Birthday on 18th September 2014 (Leiden: Nedernds Institute voor het Nabije Oosten)
Englund R (1988) Administrative timekeeping in ancient Mesopotamia. J Econ Soc Hist Orient 31:121–185
Englund R (2004) Proto-cuneiform account-books and journals. In: Hudson, Wunsch (eds) Creating economic order: record-keeping, standardization and the development of accounting in the ancient Near East. CDL Press, Bethesda, pp 23–46
Englund R (2012) Chapter 21: Equivalency values and the command economy of the Ur III period in Mesopotamia. In: Urton G, Papadopoulos J (eds) The construction of value in the ancient world. Cotsen Institute of Archaeology Press, Los Angeles, pp 427–595
Figueira TJ (1981) Aegina: society and politics. Arno Press, New York
Finkelstein JJ (1961) Ammisaduqa’s edict and the Babylonian ‘law codes’. JCS 15:91–104
Finkelstein JJ (1965) Some new misharum material and its implications, in AS 16. Studies in Honor of Benno Landsberger on his Seventy-Fifth Birthday, pp 233–246
Finkelstein JJ (1969) The edict of Ammisaduqa: a new text. RA 63:45–64
Finley M (1981) Economy and society in ancient Greece. Chatto and Windus, London
Garfinkle SJ (2004) Shepherds, merchants, and credit: some observations on lending practices in Ur III Mesopotamia. J Econ Soc Hist Orient 47:1–30
Garfinkle SJ (2012) Entrepreneurs and enterprise in early Mesopotamia: a study of three archives from the Third Dynasty of Ur (2112–2004 BC). CDL Press, Bethesda
Gelb IJ (1965) The ancient Mesopotamian ration system. J Near East Stud 24:230–243
Goodhart C (1998) The two concepts of money: implications for the analysis of optimal currency areas. Eur J Polit Econ 14:407–432
Graeber D (2014) Debt: the first 5000 years. Melville Press, Brooklyn
Grierson P (1977) The origins of money. Athlone Press, London
Hartman LF, Oppenheim L (1950) On beer and brewing techniques in ancient Mesopotamia. Supplement to the Journal of the American Oriental Society, 10
Hawkins JD (1988) Royal statements of ideal prices: Assyrian, Babylonian, and Hittite. In: Canby JV et al (eds) Ancient Anatolia: aspects of change and cultural development. Essays in honor of Machteld J. Mellink. Madison, pp 93–102
Heichelheim FM (1958) An ancient economic history, from the palaeolithic age to the migrations of the Germanic, Slavic and Arabic nations, vol I. Rev. ed., Sitjhoff, Leiden
Hoebel EA (1968[1964]) The law of primitive man: a study in comparative legal dynamics. Atheneum, New York
Hudson M (1992) Did the Phoenicians introduce the idea of interest to Greece and Italy – and if so, when? In: Kopcke G, Tokumaru I (eds) Greece between East and West: 10th–8th centuries BC. Philipp von Zabern, Mainz, pp 128–143
Hudson (1994) Land Monopolization, Fiscal Crises and Clean Slate ‘Jubilee’ Proclamations in Antiquity. In: Hudson, Miller and Feder (eds) A Philosophy for a Fair Society, London, pp 33–79
Hudson M (1996) Privatization in history and today: a survey of the unresolved controversies, and the dynamics of privatization, from the Bronze Age to the present. In: Baruch Levine (ed) Privatization in the Ancient Near East and Classical Antiquity. Peabody Museum, Harvard, Cambridge, Mass, pp 1–72
Hudson M (2000) How interest rates were set, 2500 BC – 1000 AD: Máš, tokos and fænus as metaphors for interest accruals. J Econ Soc Hist Orient 43:132–161
Hudson M (2002) Reconstructing the origins of interest-bearing debt and the logic of clean slates. In: Hudson M, Van De Mieroop M (eds) Debt and economic renewal in the ancient Near East. CDL Press, Bethesda, pp 7–58
Hudson M (2003) The Cartalist/Monetarist debate in historical perspective. In: Bell S, Nell E (eds) The state, the market and the euro. Edward Elgar, Cheltenham
Hudson M (2004a) The development of money-of-account in Sumer’s temples. In: Hudson M, Wunsch C (eds) Creating economic order: record-keeping, standardization and the development of accounting in the ancient Near East. CDL Press, Bethesda, pp 303–329
Hudson M (2004b) The archaeology of money in light of Mesopotamian records. In: Wray R (ed) Credit and state theories of money: the contributions of A. Mitchell Innes. Edward Elgar, Cheltenham
Hudson M (2018) …and forgive them their debts: credit and redemption from Bronze Age finance to the Jubilee Year. (Dresden, ISLET Verlag 2018)
Hudson and Wunsch (2004) Michael Hudson and Cornelia Wunsch, ed., Creating Economic Order: Record-Keeping, Standardization and the Development of Accounting in the Ancient Near East (CDL Press, Bethesda, Md.)
Humphrey C (1985) Barter and economic disintegration. Man, New Series 20:48
Ingham G (2004) The nature of money. Polity Press, Cambridge
Innes AM (1913) What is money? Banking Law J May:377–408, reprinted in Randall Wary L (ed) Credit and state theory of money. The contributions of A. Mitchell Innes. Edward Elgar, Cheltenham
Innes AM (1914) The credit theory of money. Banking Law J Dec/Jan:151–168, reprinted in Randall Wary L (ed) Credit and state theory of money. The contributions of A. Mitchell Innes. Edward Elgar, Cheltenham
Jursa M (2002) Debts and indebtedness in the Neo-Babylonian period: evidence from institutional archives. In: Hudson, Van De Mieroop (eds) Debt and economic renewal, pp 197–220
Knapp GF (1924[1905]) Knapp State theory of money: Macmillan & Co, London
Kraay CM (1976) Archaic and classical Greek Coins. Methuen, London
Kraus FR (1958) Ein Edikt des Königs Ammi-saduqa von Babylon. SD, vol 5. Brill, Leiden
Kula W (1986) Measures and men. Princeton University Press, Princeton
Lambert M (1960) La naissance de la bureaucratie. Rev Hist Demogr 224:1–26
Lambert M (1961) Le premier triomphe de la bureaucratie. Rev Hist Demogr 225:21–46
Lambert M (1963) L’Usage de l’argent-metal a Lagash au temps de la IIIe Dynastie d’Ur. Revue d’Assyriologie 57:79–92
Larsen MT (1976) The old Assyrian city-state and its colonies. Akademisk Forlag, Copenhagen
Larsen MT (2015) Ancient kanesh a merchant colony in bronze age anatolia. Cambridge University Press, New York/Cambridge
Laum B (1924) Heiliges Geld: eine historiche Untersuchung über den sakralen Ursprung des Geldes. Mohr, Tübingen
Laum B (1952) Geschichte der öffentlichen Finanzwirtschaft im Altertum und Frühmittelalter. In: Gerloff W, Neumark F (eds) Handbuch der Finanzwissenschaft, 2nd edn, Tübingen, pp 211–235
Leemans (1950) The Old Babylonian merchant: his business and social position. Brill, Leiden
Manning JG, Morris I (2005) The ancient economy: evidence and models. Stanford University Press, Stanford
Menger C (1892) On the origins of money. Econ J 2:238–255. Originally published in 1871
Menger C (1871) Principles of economics. New York University Press, New York
Michel C (2013) Economic and social aspects of the old Assyrian loan contract. In: D’Agostino F (ed) L’economia dell’antica Mesopotamia (III-I millennio a.C.), Rome, pp 41–55
Ober J (2008) Democracy and knowledge. Innovation and learning in classical Athens. Princeton University Press, Princeton
Oppenheim L (1949) The golden garments of the gods. J Near East Stud 8:172–193
Polanyi K (1944) The great transformation. Beacon Press, Boston
Polanyi K, Arensberg CM, Pearson HW (eds) (1957) Trade and market in the early empires: economies in history and theory. Free Press, New York
Postgate JN (1992) Early Mesopotamian society and economy at the dawn of history. Routledge, London/New York
Powell MA (1977) Sumerian Merchants and the Problem of Profit. Iraq 39:23–29
Powell MA (1999) Wir müssen alle unsere Nische nuzten: monies, motives, and methods in Babylonian economics. In: Dercksen JG (ed) Trade and finance in Ancient Mesopotamia, Istanbul, pp 5–23
Pritchard JB (1985 [1955]) Ancient Near Eastern texts. Princeton University Press, Princeton. Paperback, 1958
Radner K (1999) Money in the Neo-Assyrian Empire. In: Dercksen JG (ed) Trade and finance in ancient Mesopotamia. MOS studies, vol 1, proceedings of the first MOS symposium [Leiden 1997]. Nederlands historisch-Archaelogisch Instituut, Istanbul, pp 127–157
Renger J (1979) Interaction of temple, palace, and ‘private enterprise’ in the old Babylonian economy. In: Lipinski E (ed) State and temple economy in the ancient Near East, vol I. Departement Orientalistiek, Leuven, pp 249–256
Renger J (1984) Patterns of non-institutional trade and non-commercial exchange in ancient Mesopotamia at the beginning of the second millennium BC. In: Archi A (ed) Circulation of goods in non-palatial context in the ancient Near East. Incunabula Graeca, vol LXXII, Rome, pp 31–115
Roth MT (1997) Law collections from Mesopotamia and Asia Minor, 2nd edn. Scholars Press, Atlanta
Sallaberger W (2013) The management of royal treasure: palace archives and palatial economy in the ancient Near East. In: Hill JA, Jones P, Morales AJ (eds) Experiencing power, generating authority: cosmos, politics and the ideology of kingship in Ancient Egypt and Mesopotamia. University of Pennsylvania Museum of Archaeology and Anthropology, Philadelphia, pp 213–255
Salmon JB (1984) Wealthy Corinth. Clarendon Press, Oxford
Samuelson P (1973) Economics, 9th edn. McGraw Hill, New York
Steinkeller P (1981) The renting of fields in early Mesopotamia and the development of the concept of ‘interest’ in Sumerian. J Econ Soc Hist Orient 24:113
Steinkeller P (2002) Money lending practices in Ur III Babylonia: the issue of economic motivation. In: Hudson M, Van De Mieroop M (eds) Debt and economic renewal in the ancient Near East. CDL Press, Bethesda, pp 109–137
Sundstrom L (1974[1965]) The exchange economy of pre-colonial Africa. St. Martin’s Press, New York, p 34, 38
Van De Mieroop M (1995) Old Babylonian interest rates: were they annual? In: Lipinski FE (ed) Immigration and emigration within the Near East. Orientalia Lovaniensia Analecta, vol 65. Departement Oriëntalistick, Louvain, pp 357–364
Van De Mieroop M (2002a) Credit as a facilitator of exchange in Old Babylonian Mesopotamia. In: Hudson M, Van De Mieroop M (eds) Debt and economic renewal in the ancient Near East. CDL Press, Bethesda, pp 163–174
Van De Mieroop M (2002b) A history of Near Eastern debt? In: Hudson, De Mieroop V (eds) Debt and economic renewal, pp 59–94
Van De Mieroop M (2004) Accounting in early Mesopotamia: some remarks. In: Hudson, Wunsch (eds) Creating economic order. ISLET, Dresden, pp 47–64
Van De Mieroop M (2005) The invention of interest. In: Goetzmann WN, Geert Rouwenhorst K (eds) The origins of value: the financial innovations that created modern capital markets. Oxford University Press, Oxford, pp 17–30
Veenhof KR (1972) Aspects of old Assyrian trade and its terminology. Brill, Leiden
Veenhof KR (2010) The interpretation of paragraphs t and u of the Code of Hammurabi. In: Hazirlayan Y, Dönmez S (eds) DUB.SAR E.DUB.BA.A: studies presented in honour of Veysel Donbaz, Istanbul
Ventris M, Chadwick J (1956) Documents in Mycenaean Greek: three hundred selected tablets from Knossos, Pylos and Mycenae with commentary and vocabulary. Cambridge University Press, Cambridge
von Böhm-Bawerk E (1890[1884]) Capital and Interest: A Critical History of Economic Theory. London, Macmillan & Co
Wray LR (ed) (2004) Credit and state theories of money: the contributions of A. Mitchell Innes. Edward Elgar, Cheltenham
Wunsch C (2002) Debt, interest, pledge and forfeiture in the Neo-Babylonian and early Achaemenid period: the evidence from private archives. In: Hudson M, Van De Mieroop M (eds) Debt and economic renewal in the ancient Near East. CDL Press, Bethesda, pp 221–255
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2019 Michael Hudson
About this entry
Cite this entry
Hudson, M. (2019). Origins of Money and Interest: Palatial Credit, Not Barter. In: Battilossi, S., Cassis, Y., Yago, K. (eds) Handbook of the History of Money and Currency. Springer, Singapore. https://doi.org/10.1007/978-981-10-0622-7_1-1
Download citation
DOI: https://doi.org/10.1007/978-981-10-0622-7_1-1
Received:
Accepted:
Published:
Publisher Name: Springer, Singapore
Print ISBN: 978-981-10-0622-7
Online ISBN: 978-981-10-0622-7
eBook Packages: Springer Reference Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences