A Comparative Perspective on the Determinants of the Scale and Productivity of Maritime Trade in the Roman Mediterranean
22 Pages Posted: 23 Mar 2009
Date Written: March 21, 2009
The scale and productivity of maritime trade is a function of environmental conditions, political processes and economic development that determine demand, and more specifically of trading costs. Trading costs are the sum of transportation costs (comprised of the cost of carriage and the cost of risk, most notably predation), transaction costs and financing costs. Comparative evidence from the medieval and early modern periods shows that the cost of predation (caused by war, privateering, piracy, and tolls) and commercial organization (which profoundly affects transaction and financing costs as well as the cost of carriage) have long been the most important determinants of overall trading costs. This suggests that conditions in the Roman period were unusually favorable for maritime trade. Technological innovation, by contrast, was primarily an endogenous function of broader political and economic developments and should not be viewed as a major factor in the expansion of commerce in this period.
Keywords: Trading costs, predation costs, transaction costs, financing costs, commercial organization, maritime trade
JEL Classification: F10, F14, F15, H41, L92, O31
Suggested Citation: Suggested Citation