George Bitros reviews Economous’ book “The Economics of Classical Athens”

A few years ago, the renowned physician John Ioannidis, Professor of Epidemiology and Population Health at the Stanford Prevention Research Center, wrote an article in the Greek edition of HuffingtonPost to express his dismay at the alleged lack of interest of local researchers in the study of Greece, its history, its language and the original ideas that were born there and that have fertilized human civilization.

I wrote to explain that this was not the case, at least not from the perspective of economists, economic historians, political scientists, and other social and behavioral scientists. And to prove my point, I sent him a volume of papers we edited in 2011 as part of an international conference held in Athens the previous year to mark the 2500th anniversary of the Battle of Marathon. But now, in light of the book I am about to review, I can offer further, if not stronger, evidence.

Some of us are economists who have worked in Greece for decades and have done everything necessary to study the economy and democracy in classical Greece, and in Athens in particular, and have built solid bridges with our colleagues abroad so that the study of the economy and institutions of ancient Greece will continue long after we are gone.

The proof I am talking about is none other than the praise that accompanies the publication of this book, The Economy of Classical Athens: Organization, Institutions, and Society.

After all, how often does it happen that someone writes an essay or paper in a scientific field and is then lucky enough to have a top-notch scientist in the same field vouch for the paper?

I suppose that is rare. And yet here we have not one but three such scholars, Paul Cartledge, Carl Hampus Lyttkens and Thomas J. Figueira, who put their stamp on this book, while the latter, a world-renowned economic historian with stacks of widely cited papers and books on ancient Greece, has even written an exquisite introduction. I am delighted to be in their company and very glad of the opportunity to explain why I find that the ancient Athenian economy, as documented here, is much closer than I thought to the economic structure observed by the great classical economists in the late 18th and early 19th centuries, especially in England and France.

The gist of the book is clear. There was the rule of law, great protection for private property, rapid and unfettered enforcement of contracts, a trusted medium of exchange for trade supported by the city-states, and a network of financial institutions that mediated between savers, investors, and the city-state administration when social circumstances required stopgap funds. Under these conditions, any economics student anywhere in the world who has completed the basics of economics would today imagine the emergence of a free market economy.

What is missing, in the current state of our knowledge, is only an emphasis on the time that might be required to switch from the so-called market period, in which prices adjust to allocate existing quantities, to the long-run period, which covers a sufficiently long period to allow the reallocation of factors of production from the present to other uses as firms enter or leave the market in question according to their profit expectations. It is undoubtedly reassuring, therefore, that an observer from the fourth century BCE provides this solid testimony on the characteristics of market-based resource allocation as regards the structure of the economy then prevailing in ancient Athens.

Is the book and the extensive literature on which it draws an exercise in intellectual curiosity or perhaps a process of learning from the past in order to develop optimal approaches to solving current problems?

As I said above, I firmly believe that the latter is the case. But now I can support this view with an example. In recent years, Greece has faced another threat in the Aegean Sea, equally or even more powerful than the Persians. To defend itself, it buys all kinds of weapons abroad and spends enormous sums of money that are needed elsewhere. Kolliniatis (2024) suggests that Greece should adopt the doctrine devised by Themistocles to save Athens, while at the same time creating the conditions for its economic development by developing its armaments industry. Just think of this challenge. In three years, from 483 to 480 BC, the Athenians managed to build 200 triremes, improve the ones they already had, and deploy them all ready for battle on the decisive morning of September 20, 480 BC, when the mighty Persian navy appeared in the Strait of Salamis. To achieve this miracle, the economy of ancient Athens had to be transformed from an agrarian economy to one based on trade, crafts and services. Today’s Greeks should do the same. Applying the teaching of Themistocles to the current circumstances of Greece, Dr. Kolliniatis establishes why this book is timely as a call to “go back to the classics” to address the problems that plague not only Greece but all contemporary Western-style democracies.

*George C. Bitros is Professor Emeritus of Political Economy at the Athens University of Economics and Business