Learning from Imperial Rome

[thaaanos]

you forget the English coal mines used even in Roman times and Later (19 century) The German & Belgian Coal mines... europe never hit a real energy crisis as they had access to coal for metallurgy and the industrial revolution, combined with a criss-cross of riverways + mediterranean sea for almost free-energy transportation, communication and trade.
In China though coal is much deeper and only in modern times the energy gains pay off. I don't really know the efficiency of chinese trade at the time though.

It seeems reading a bit of history will do the trick, it appears that the English had transformed the China into an opium junkie.
They growed opium in india to flood the Chinese market and tip the balance of  trade  in their favour. So it would seem that the rise of Western Europe and the decline of China could be simple: basic drugdealing

[Adrian-x]

you forget the English coal mines used even in Roman times and Later (19 century) The German & Belgian Coal mines... europe never hit a real energy crisis as they had access to coal for metallurgy and the industrial revolution, combined with a criss-cross of riverways + mediterranean sea for almost free-energy transportation, communication and trade.
In China though coal is much deeper and only in modern times the energy gains pay off. I don't really know the efficiency of chinese trade at the time though.

It seeems reading a bit of history will do the trick, it appears that the English had transformed the China into an opium junkie.
They growed opium in india to flood the Chinese market and tip the balance of  trade  in their favour. So it would seem that the rise of Western Europe and the decline of China could be simple: basic drugdealing

in other news http://www.newscientist.com/article/mg22229632.600-coal-fuelled-china-long-before-industrial-revolution.html#.Uz4JtlfETtw

[minor-transgression]

I came across some interesting thoughts on another thread:
https://bitcointalk.org/index.php?topic=554616.0

while I am researching a couple of ideas, I have some notes for reference:

"The Roman Empire grew through conquest. Subsequent conquests were financed by the spoils of the previous
conquests and the increased taxes from expansion. The conquests also financed the increasing size of bureaucracy
required to maintain an expanding empire."

True, up until Egypt was seized by Augustus, after that Rome preferred a defensible frontier, or
was forced into war by circumstances.

"Once the cost of maintaining the empire exceeded the returns from expansion, the empire stopped growing. "
The history is somewhat more complicated.
in AD14 Tiberius ordered Germanicus to the Northern extent of the Empire to put down a mutiny by the
troops overy pay. Once there Germanicus took the Army and the mutineers into Germany and plundered the
area as a reward to the Legions.
By 105AD Rome needed silver and gold to expand its monetary base, and to pay the Army. Trajan built a bridge
across the Danube, and plundered Dacia, also gaining access to the rich mines of the area.
In 272AD Aurelian went to war with the Palmyrene Empire to regain control of Egypt and the grain supplies
to Rome.
Hence while the statement is evidently true, the calculation of excess returns is at best, imprecise.
Also, after 167BC the costs ot the campaign were borne by their provinces.

"For example, administering the farthest regions of the empire became more costly
than the income from those regions, and some of them were abandoned. Conquering England brought less spoils
than the cost of that conquest."
Paying the Army on the frontier was always a loss leader, but it put Roman money into the local economy,
and financed the Roman lifestyle. Roman Monopolies always made the centre appear more affluent.

"At this point the empire began debasing the currency to compensate for the decrease in spoils and new
populations to tax."
I am uncomfortable with that statement. Arguably peace, technology and infrastructure, access to capital,
and the Roman economy increased wealth and GDP and thus the tax base.

"The empire also increased taxes and became more repressive."
For example, in 167BC, "Rome no longer needed to levy a tax against its citizens in Italy", so not
the whole story, but see below.

"The currency was so debased as to be practically worthless, but the empire still paid its military
and bureaucracy with it. Eventually the empire grew so weak it was unable to resist barbarian invasions and Rome fell".
Debased is not the same as worthless. The modus operandi following the accession of an Emperor was:
debasement to pay off the Army, thus delivering a stimulus to the economy and a spike in inflation, and
thereafter gentle deflation in the Emperor's lifetime. Over time, this probably caused problems with trade,
and I seem to recall that India wanted gold for spices and China wanted silver for silks.
The gold content of Roman coins was almost always of high purity [modern coins have some copper to
reduce wear], but the Roman silver coins went from 97 percent to 2 percent silver. My back-of-an-envelope
calculation shows a further complication: between 250AD and 270AD almost 90 percent of the silver
content of the coins in circulation may have disappeared. How much was hoarded, how much was stolen,
and how much was melted down for foreign trade is anybody's guess. In 271AD Aurelian slaughtered 7000
at the mint in Rome to end the fraud and the theft of silver.
From 250AD to 270AD trust in the currency weakened, barter became more frequent, and by 300AD even
the Military were paid in kind, resulting in the imposition of a reign of terror on the countryside.

"Peasants were so overburdened that some abandoned their fields and went to Rome for the dole, some sold children
into slavery, etc. The peasants were increasingly complacent to barbarian invasions and some welcomed barbarians
as liberators."
Again, not the whole story. See: http://www.unrv.com/economy/roman-taxes.php
"Large inflation rates and debased coinage values, by the reign of Diocletion, led to one of the more drastic
changes in the system. In the late 3rd century AD, he imposed a universal price freeze, capping maximum prices,
while at the same time he reinstated the land tax on Italian landowners. Special tolls on money traders and
companies were also imposed to help increase the tax collections.
Diocletion's program, in theory, should have helped ease the burden on various classes of taxpayers, but it
didn't work that way in practice. As an example, additional taxes were levied on land owners after the land tax had been paid because this was now a separate tax, instead of taking into account that taxes had already been collected. The burden of paying the expected amounts was shifted from communities and individuals within them, to the local senatorial class. The Senators who would then be subject to complete ruin in the case of economic shortfall in a particular region. Following Diocletion, Constantine compounded these burdens by making the senatorial class hereditary. By so doing, all debts and economic ramifications were passed from one senatorial generation to the next, ruining entire families and never allowing for a recovery that could benefit an entire community"

In summary, a much more confusing picture of the collapse. My belief remains that excessive debt was the
driver for the collapse, but the link between cause and effect remains elusive.

[thaaanos]

Interestingly these days I found an article in the most gruesome aspects of the Byzantium emperors...
that make Game of Thrones is like a fairy tale, If i get some time I will translate it.

First chapter:

Constantine had a bastard son whom he dearly Loved, His wife Fausta, fearing that the empire will fall to the bastard instead of her sons, courts the bastard in order to expose him to Costantine. She fails and instead tells Constantine that his bastard tried to rape her. So Constantine kills him.
After some time when the plot is exposed, he drowns Fausta in boiling water. Then the brother of Fausta conspired to incite rebelion in Spain, but Constintine decaped him and sent his head to Carthagena.

[johnytelevision]

A lot to read. Maybe you should write blog

[minor-transgression]

The Byzantine history - I would be very interested to read up on that. The economy of medieval India
was also quite sophisticated, as is any nation exposed to maritime trade.

Just FYI - I'm attempting an extension to my model of the Roman Economy, and it may take some time.
Augustus had the benefit of acquiring silvermines in what is now Spain soon after he became Emperor,
and that may have had the side effect of price inflation toward the end of his reign, thus creating a
crisis that Tiberius dealt with successfully IMHO.
Aurelian and Diocletian found themselves facing price inflation arising from debasement of the silver
coinage and failed to contain the crisis. The reference to seizing gold and silver from the taxpayers
and paying them with fiat currency (the gold content of their coins was less than the face value of
the money) is telling a story.
Modelling that will be challenging.

[BitDreams]

BitDreams - thanks for the links - I was unaware that someone had made the connection between
interest rates and the Kondratiev long wave. There may also be a causal relationship
between Debt and generational change, the "Fourth Turning" etc, but there is enough
basic math to work on here without invoking either metaphysics or religion ;-)

Found on that link:
"Obviously, with a date for universal debt forgiveness written in stone, no lender would ever set terms for repayment PAST the Jubilee year."
But see this :
http://www.infosources.org/what_is/Code_of_Hammurabi.html
"The laws (numbered from 1 to 282 but numbers 13, 66-99, 110 and 111 are missing) are on an 8 foot tall stela of black diorite"
Not as easy as wiping a hard disc, but stone yields to a hammer and chisel eventually ;-)
It does make you curious about laws 66-99, No?

Seriously though, attempts to subvert and evade a Debt Jubilee are a certainty in any Age.

Elsewhere on that link a graphs show "interest" at 10 percent and seven percent "growth",
suggested that such an economic system could not continue indefinitely.
Stated that way, I'd suggest the proposition is misleading, though not incorrect, and if I may,
I will direct my reply as best I can toward the economy of Imperial Rome.
The census figures suggest that the Roman population grew by a little over 0.5 percent per year,
and based on best guesses, productivity grew similarly, giving growth in the economy of a little
over one percent per year in most periods.
I had a look at the effect of increasing productivity in an economy with 0.5 percent population
growth and fixed rates of interest of 10 and seven percent - all figure approximate,
using a variant of Keen's Minsky model. The results were unexpected and intriguing, - I don't know
how long it will take to get my head around these dynamics. [ Some of the results are pure
vanilla - see Dr Grasselli's and Prof Keen's papers and video, the other results, ...  too early to tell. ]

re: It does make you curious about laws 66-99, No? Yes! I didn't know they were missing!
Eventually someone will try to code them into the block chain perhaps? I would suggest leaving someone
such as yourself to propose a few of those laws to fill in the blanks  

What are you doing with the new variable Bitcoin? disaster recovery through a not uncommon fork in the block chain. Bad regulations failing faster?
Common sense with mathematical precision and the blockchain efficiently enforcing contracts. Easy audits, nothing to prevent success and everything to eliminate waste. A wealth effect never seen on earth where taxes become voluntary, charity between strangers not uncommon (karmacoin for example), commerce at the cost of a kind word, every keystroke even. Societies' most popular occupation after Bitcoin fuels robotics might only be to entertain and to care for each other. I believe Bitcoin is the fuel for many things. Are you building a launch pad?

[josephliton]

I came across some interesting thoughts on another thread:
https://bitcointalk.org/index.php?topic=554616.0

while I am researching a couple of ideas, I have some notes for reference:

"The Roman Empire grew through conquest. Subsequent conquests were financed by the spoils of the previous
conquests and the increased taxes from expansion. The conquests also financed the increasing size of bureaucracy
required to maintain an expanding empire."

True, up until Egypt was seized by Augustus, after that Rome preferred a defensible frontier, or
was forced into war by circumstances.

"Once the cost of maintaining the empire exceeded the returns from expansion, the empire stopped growing. "
The history is somewhat more complicated.
in AD14 Tiberius ordered Germanicus to the Northern extent of the Empire to put down a mutiny by the
troops overy pay. Once there Germanicus took the Army and the mutineers into Germany and plundered the
area as a reward to the Legions.
By 105AD Rome needed silver and gold to expand its monetary base, and to pay the Army. Trajan built a bridge
across the Danube, and plundered Dacia, also gaining access to the rich mines of the area.
In 272AD Aurelian went to war with the Palmyrene Empire to regain control of Egypt and the grain supplies
to Rome.
Hence while the statement is evidently true, the calculation of excess returns is at best, imprecise.
Also, after 167BC the costs ot the campaign were borne by their provinces.

"For example, administering the farthest regions of the empire became more costly
than the income from those regions, and some of them were abandoned. Conquering England brought less spoils
than the cost of that conquest."
Paying the Army on the frontier was always a loss leader, but it put Roman money into the local economy,
and financed the Roman lifestyle. Roman Monopolies always made the centre appear more affluent.

"At this point the empire began debasing the currency to compensate for the decrease in spoils and new
populations to tax."
I am uncomfortable with that statement. Arguably peace, technology and infrastructure, access to capital,
and the Roman economy increased wealth and GDP and thus the tax base.

"The empire also increased taxes and became more repressive."
For example, in 167BC, "Rome no longer needed to levy a tax against its citizens in Italy", so not
the whole story, but see below.

"The currency was so debased as to be practically worthless, but the empire still paid its military
and bureaucracy with it. Eventually the empire grew so weak it was unable to resist barbarian invasions and Rome fell".
Debased is not the same as worthless. The modus operandi following the accession of an Emperor was:
debasement to pay off the Army, thus delivering a stimulus to the economy and a spike in inflation, and
thereafter gentle deflation in the Emperor's lifetime. Over time, this probably caused problems with trade,
and I seem to recall that India wanted gold for spices and China wanted silver for silks.
The gold content of Roman coins was almost always of high purity [modern coins have some copper to
reduce wear], but the Roman silver coins went from 97 percent to 2 percent silver. My back-of-an-envelope
calculation shows a further complication: between 250AD and 270AD almost 90 percent of the silver
content of the coins in circulation may have disappeared. How much was hoarded, how much was stolen,
and how much was melted down for foreign trade is anybody's guess. In 271AD Aurelian slaughtered 7000
at the mint in Rome to end the fraud and the theft of silver.
From 250AD to 270AD trust in the currency weakened, barter became more frequent, and by 300AD even
the Military were paid in kind, resulting in the imposition of a reign of terror on the countryside.

"Peasants were so overburdened that some abandoned their fields and went to Rome for the dole, some sold children
into slavery, etc. The peasants were increasingly complacent to barbarian invasions and some welcomed barbarians
as liberators."
Again, not the whole story. See: http://www.unrv.com/economy/roman-taxes.php
"Large inflation rates and debased coinage values, by the reign of Diocletion, led to one of the more drastic
changes in the system. In the late 3rd century AD, he imposed a universal price freeze, capping maximum prices,
while at the same time he reinstated the land tax on Italian landowners. Special tolls on money traders and
companies were also imposed to help increase the tax collections.
Diocletion's program, in theory, should have helped ease the burden on various classes of taxpayers, but it
didn't work that way in practice. As an example, additional taxes were levied on land owners after the land tax had been paid because this was now a separate tax, instead of taking into account that taxes had already been collected. The burden of paying the expected amounts was shifted from communities and individuals within them, to the local senatorial class. The Senators who would then be subject to complete ruin in the case of economic shortfall in a particular region. Following Diocletion, Constantine compounded these burdens by making the senatorial class hereditary. By so doing, all debts and economic ramifications were passed from one senatorial generation to the next, ruining entire families and never allowing for a recovery that could benefit an entire community"

In summary, a much more confusing picture of the collapse. My belief remains that excessive debt was the
driver for the collapse, but the link between cause and effect remains elusive.

The most dramatic fall in faith in the EU has occurred in Spain, where the banking and housing ... for the EU of the kind that is common in Britain but is much more rarely seen on the continent. .... The EU has lost the plot – it must modernise and re-engage its citizens.

[Full Spectrum]

Major cause in the fall of Rome was rising security costs. This was associated with the fall of the Western and Eastern Empires. The Romans in the West had to deal with the Germanic Tribes fleeing from the Huns, whom invaded and settled in Roman Territory and proceeded to sack Roman cities, in return West Rome had to pay for security. This caused security prices to rise which was curbed by recruiting "Romanized" Germans to fight for Rome. Eventually the people fighting for West Rome saw their was more to gain by sacking Western Rome than by defending. Same applies for Eastern Rome except that they were invaded and sacked by the Arabs and converts to Islam. To curb rising security costs they called on the former Western Roman lands "Christianized" Germans to help recapture lands(crusades). This went well the 1st time, tie the 2nd, failed the 3rd, and the 4th ended with said volunteers seeing that more was to gain by attackin Eastern Rome than by defending it, this culminated with sacking the capital (Constantinople). Which effectively ended the empire.

Moral of the story: DIRECTTV COMMERCIAL NARRATOR"When tribals start attacking your borders, you begin spending money on security. When you begin spending money on security, you try to cut costs. When you cut costs you hire Germans. When you hire Germans, they sack your cities. Don't let Germans sack your cities! Switch to nuclear weapons today!"

JUST JOKING! 
The true moral of the story is that security expense is the one of the most wasteful expenses as it creates absolute nothing, as the jobs it creates create zero capital.

[minor-transgression]

"Major cause in the fall of Rome was rising security costs."

True in the sense that it's not the fall that kills you, but that impact with a hard surface.

A declining GDP and tax base meant they could not afford the needed security,
somewhat like earlier times when they had to pay off barbarians for a quiet life.

The transition to a gold-based currency in Constantinople is interesting though, and
shows that empires can last a long time if the conditions are right.

BTW, if you own bitcoin, Keen's views on the European economy should be of interest:
http://www.debtdeflation.com/blogs/2014/06/22/economic-theory-making-europes-crisis-worse-1/

I am still thinking about the implications for bitcoin, but an expanding government
deficit would seem to contradict the need for a fixed quantity of money. Hence the comment
about Constantinople.

[minor-transgression]

The reworking of my model of the Roman Economy around the time of Augustus is ongoing, but it is
time to reflect. Among other things, the value of the exercise is the concentration of the mind
around things Bitcoin. There are similarities in thought processes there that are largely absent in
today's world. Few people alive today have purchased goods with silver coins. Fewer still have
worried about the falling silver content of the coins they own. But back to history ...

There were civil wars prior to the Battle of Actium (31 BC). Then, Augustus (Octavian) fought on the
same side as Anthony, but Anthony removed himself to Egypt, leaving Octavian with a massive bill of
expenses for the Army. When Anthony marries Cleopatra there is a threat to Octavian and to Rome,
war is declared, and they clash at Actium.

His victory places Octavian at the head of the known world with 60 legions and the treasury of Egypt
at his command. Over the next three years, the Rome will have an economic boom as 32 Legions are
progressively paid off, costing Octavian 150M denarii, (Roman GDP is of the order of 1000M denarii pa).
When Octavian returns to Rome, he brings with him cartloads of money from the Egyptian Treasury,
prisoners and the emblems of captured Cities and Princes. 250 denarii went to every soldier and
100 denarii to every citizen [Stobart p150]. Interest rates fell instantly from eleven percent to
four percent. (Try to imagine Mr Draghi giving every EuroZone family a year's wages in bitcoin and
all tax free!)

The surplus manpower he then put to good use: construction in Rome, earthworks and irrigation in Egypt.
The silver mines in Gaul and the Iberian peninsula came later, and all were in his domain when he took
the title of Augustus. There followed a long period (18 BC to 6 BC) of grain price deflation, with
Egyptian wheat prices falling from 9.3 to 1.9 [Prodromidis], followed by a period of stability
(4 BC to 4 AD).

Try to view the world through the eyes of a citizen in Sicily in this time of Augustus.
He will have his grain harvest in, and faces a choice. Store the grain, or sell for silver. He will want
to know how prices will change up to and including the next year's harvest. To do that he is
interested in how the world is changing. No wars or rumours of wars? With a fixed supply of money,
ie silver, and increasing grain shipments from Egypt, his expectation is that he will get less silver for
his grain the next year. Should he sell his land or plant vines or olive trees and wait? As supplies from
Egypt grow, grain becomes a smaller part of Roman GDP, and land and property prices, particularly
around Rome are rising, hence grain prices are a poor guide to price inflation in this economy of
Augustinian Rome. For tracking price inflation, however, grain prices are the only game in town.
What adjustment to make ... ?

Adjustments are a problem. Once begun, it is difficult to avoid making adjustment. It gets complicated
very quickly, simplicity is soon gone. So, where to begin?

[manselr]

you forget the English coal mines used even in Roman times and Later (19 century) The German & Belgian Coal mines... europe never hit a real energy crisis as they had access to coal for metallurgy and the industrial revolution, combined with a criss-cross of riverways + mediterranean sea for almost free-energy transportation, communication and trade.
In China though coal is much deeper and only in modern times the energy gains pay off. I don't really know the efficiency of chinese trade at the time though.

It seeems reading a bit of history will do the trick, it appears that the English had transformed the China into an opium junkie.
They growed opium in india to flood the Chinese market and tip the balance of  trade  in their favour. So it would seem that the rise of Western Europe and the decline of China could be simple: basic drugdealing

About china and the Roman Empire, you can draw a paralel: They both achieved wealth by focusing on producing and being inventive about how to exploit people without people rebeling. This doesnt last forever as we can see tho.

[Febo]

So where Attila comes into this picture?

[pattu1]

you forget the English coal mines used even in Roman times and Later (19 century) The German & Belgian Coal mines... europe never hit a real energy crisis as they had access to coal for metallurgy and the industrial revolution, combined with a criss-cross of riverways + mediterranean sea for almost free-energy transportation, communication and trade.
In China though coal is much deeper and only in modern times the energy gains pay off. I don't really know the efficiency of chinese trade at the time though.

It seeems reading a bit of history will do the trick, it appears that the English had transformed the China into an opium junkie.
They growed opium in india to flood the Chinese market and tip the balance of  trade  in their favour. So it would seem that the rise of Western Europe and the decline of China could be simple: basic drugdealing

This site gives a timeline of the opium trade with China.

http://www.irinnews.org/indepthmain.aspx?InDepthId=21&ReportId=63040
1601 -    Ships chartered by Queen Elizabeth I are instructed to purchase the finest Indian opium and transport it back to England.
1620s-1670s -    From 1637 onwards opium becomes the main commodity of British trade with China.
1729 -    Chinese emperor Yung Cheng issues an edict prohibiting the smoking of opium and its domestic sale, except under licence for use as medicine.
1796 -    The import of opium into China becomes a contraband trade. Silver is smuggled out to pay for smuggling opium in. But three years later China's emperor, Kia King, bans opium completely, making trade and poppy cultivation illegal.
1839 -    Lin Tse-Hsu, imperial Chinese commissioner in charge of suppressing the opium traffic, orders all foreign traders to surrender their opium. In response, the British send expeditionary warships to the coast of China, beginning The First Opium War.

[BitDreams]

http://fee.org/the_freeman/detail/of-bread-and-circuses

Forty years later, the Roman historian, Fronto, echoed the charge in more prosaic language: “The Roman people is absorbed by two things above all others, its food supplies and its shows.” (Ibid.)

Here was a once-proud people, whose government had been their servant, who had finally succumbed to the blandishments of clever political adventurers. They had gradually relinquished their sovereignty to government administrators to whom they had granted absolute powers, in return for food and entertainment. And the surprising thing about this insidious progression is that, at the time, few realized that they were witnessing the slow destruction of a people by a corruption that would eventually transmute a nation of self-reliant, courageous, sovereign individuals into a mob, dependent upon their government for the means of sustaining life.

From the same article, some conclusions:

First—Let us stop this headlong rush toward collectivism. Let there be no more special privileges for employers, employees, farmers, businessmen or any other groups. This is the easiest step of all. We need only refrain from passing more socialistic laws.

Second— Let us undertake at once an orderly demobilization of many of the existing powers of government by the progressive repeal of those socialistic laws which we already have. This will be a very difficult step because every pressure group in the nation will fight to retain its subsidies, monopoly privileges and protection. But if freedom is to live, all special privileges must go.

Third—Of the powers that remain in government, let us return as many as possible to the states. For on the local level, the people will be able to apply more critical scrutiny to the acts of their government agents.

Fourth—Above all, let us resolve that never again will we yield to the seduction of the government panderer who comes among us offering “bread and circuses,” paid for with our own money, in return for our sovereign rights!

I could envision government as a series of sidechains off the main blockchain used to contract with government. Social funding could have a 'use-by' date preventing bloat and waste while providing safety nets as needed by simply spinning up new sidechains. Special interest groups would campaign via blockchains openly and transparently, with cause and effect clearly on display. Ultimately, this might allow taxation to become totally voluntary as you can choose which blockchains you are conducting business in. Some blockchains could have local enforcements and if you don't wish to support a local blockchain, it would come at the cost of being an outcast in your local community - but that's what government from the bottom up would feel like.

[minor-transgression]

Work on my modelling to resolve some things that do not work out right is ongoing, and I will
post on that later. When I read anything on Imperial Rome I tend to question it, especially
when the writer is *absolutely certain* of his findings. With that caveat, a summary:

The Civil wars end in 31AD, and the military becomes progressively stronger as the economy
and the Empire expands. While the centre is settled, fewer legions are needed to hold the
frontier. The Empire, population and productivity peak around 124AD and after 200AD, the
decline sets in. With unrest in the centre, more troops are needed, and the military takes
a progressively greater share of GDP. Diocletian breaks up the Army and the Empire in
305AD, but it is too late for the western provinces, because all the silver and gold is gone.

That summary was developed using grain as a proxy for inflation. If that changes my view
will change. Today, in my humble opinion, the Roman Financial system, and its interaction
with the army is a far better explanation than others including "The Dole", or "Excessive
Administration", or "Socialist Policies" for the decline of Imperial Rome. However, reasoned
contrary opinion is both desired and welcomed.

[minor-transgression]

Grain as a component of GDP in Imperial Rome (a rough approximation would be today's diesel fuel)
Source - The Complete Roman Army by Adrian Goldsworthy, pg 95 (and others)
From the account of Quintus Julius Proculus from Damascus, Auxiliary, AD81
Derived figures for gross national consumption, percentages (rounded for simplicity):
Food            50
Clothing        20
Entertainment   10
Shelter         20

(Food would have a slightly higher percentage for a family of four, but I'm going with the
above figures until someting better comes along.)
Suggested figures are that grain provided 67% - 75% of calorific intake. Hence a figure of
40% for grain as a proportion of GDP seems plausible. And if the price of grain doubles or
trebles as sometimes happens? and what does that do to productivity?
Schiedel has a figure of 50 million tonnes of grain equivalent for the GDP of Imperial Rome.
I am taking that to mean the actual grain production in 124AD was 20 million tonnes, with a
price of 9 Drachmae per Artaba, and 5 billion denarii.

Just looking at the data, the variations in grain prices can be explained by fiscal and
monetary changes. Except, that is, for the Augustinian period, and there is an explanation
for that. Which leaves the period of Aurelian through Diocletian, and the hyperinflation.

And this:
In 41/2 A.D. Claudius introduced tetradrachmae (four drachmae pieces) minted from billon,
an alloy less than 25% silver, and equal to 1 silver denarius. So what happened to grain
prices prior to 41AD?
Each silver Drachma weighs ~4.3 grams (it varies a lot) and the Denarius of Augustus weighs
3.8 grams, and the Attic standard was 1 silver Drachma = 1 silver Denarius.

Today's equivalent would be to pay in Litecoin instead of Bitcoin but paying the same number of coins.
The poor sods in Egypt were being ripped off even as far back as 41AD. It looks like it took
until ~68AD for them to figure out that scam.

[BitDreams]

Today, in my humble opinion, the Roman Financial system, and its interaction
with the army is a far better explanation than others including "The Dole", or "Excessive
Administration", or "Socialist Policies" for the decline of Imperial Rome. However, reasoned
contrary opinion is both desired and welcomed.

Can't find any arguments against your explanation. This is a great thread and I'm learning a lot from your research. The social issues interest me as I attempt to draw connections on how society can limit government to servitude. I view 'The Dole' as citizens commission on conquest. If the financial system had truly pegged citizens commission to net conquest returns in timely manner, how would that change history or our future is where my interest lies.

[minor-transgression]

Things in today's world are moving somewhat faster than in Roman times, and I am
compelled to set aside the work I was doing to integrate coinage into the model, at
least until things quieten down a little. With the usual caveats, here are some
notes on where we are today.

Debasement of the coinage was completed in the late 1960's and early 1970's with fiat
money continuing to expand exponentially. Post 2000 the real economy diverged from
the monetary system with money remaining inside the banks, and progressively lower
rates of growth in the real economy, and moving into negative growth rates in 2014.

Theoretically ("it's really simple"), a sufficiently large stimulus should re-ignite
growth. In the real world, that just doesn't make sense, because the present world
has diminishing returns on anything that doesn't scale.

There is a more general case to be made, but first, here is Steve Kopits on Oil:
http://www.youtube.com/dLCsMRr7hAg
http://energypolicy.columbia.edu/sites/default/files/energy/Kopits%20-%20Oil%20and%20Economic%20Growth%20%28SIPA%2C%202014%29%20-%20Present$
.... and oil supply determines global GDP - supply constrained demand.
"counter-intuitive by historical patterns"
"productivity of capital has declined by 5 percent over the last decade"
"demand constrained model, price = marginal cost" (customer pays)
"supply constrained, ... do with less rather than pay more"
"borrowing money to pay dividends"
"major divestment programs" "is this sustainable?"
Oil Majors - 20 to 30 percent reduction in CapEx 2013 - 2015
Given no increase in oil production " ... OECD GDP growth will continue to lag
indefinitely, with a long term GDP growth rate in the range 1-2% entirely plausible
and indeed likely."
"In turn, if this is true, then current national budget deficit levels and debt
levels will prove unsustainable, and a second round of material and lasting
adjustment will be necessary"

I would caution that the eight percent efficiency gains in recession are also
unsustainable. Typically companies in difficulties defer maintenance and other
similar costs that are inevitably added back in at a later date.

In the general case, the world spends some ten percent of its energy in mining.
Mining includes the fossil fuels that provide 90 percent of that energy, and
all sectors show a drift towards higher energy costs as ore quality declines.
Overall a ERoEI figure of 16 is plausible for 2010, with a figure of 10 for
oil production. At some time in the future, that 16 will fall to 10 and then
to 9. Everything else being equal, to maintain the standards to which we have
become accustomed, we need to use one percent less less energy for our daily
activities either by doing less or by increased efficiency. We will not maintain
that balance for very long, thanks to exponential decreases in ore quality.

Hence there are two checkpoints in our trajectory, further in the future for
the general case, and now for our use of crude oil (because oil's ERoEI is
already at 10 and oil is the binding resource.)

In a world constrained by oil supply, the dynamics of price and flow are
unfamiliar. Payment is increasingly in currency other than the US$ and may
be in roads, hospitals and schools at rates set for many years. Much depends
on innovative improvments in efficiency and the use of alternatives to oil.
One of many possible models of flow and price is here:
http://www.thehillsgroup.org/depletion2_022.htm
That shows a steep downward slope in the price of oil from 2012 to 2020,
(and a presumption of falling oil consumption, not shown).

Recent data on oil and gas (click on report):
http://oilprice.com/Energy/Energy-General/Early-Signs-Of-A-Pullback-In-Drilling-Activity.html

I said previously that I see a parallel between oil today and grain in
Imperial Rome. And back in Imperial Rome circa 350AD, opressive taxation,
crony capitalism, and fifty years of appropriation by the army had so
impoverished the freemen peasants that they were abandoning the land for
slavery, causing food production to fall amidst hyperinflation. Goods
that attracted tax were falling in price while the price of food
increased, so care is needed when attributing price variation. Lacking
paper fiat currency, ox carts were needed to move debased currency
from place to place, (the HFT trade of that day.) And this: "Previous measures
to ease the tax burden, however, were ineffective because they only
relieved the wealthy."

Economists have been taught to believe that, today, unconditionally,
the central banks can always create hyperinflation by creating and
distributing money - "helicopter money". That may change :
http://www.voxeu.org/article/helicopter-money-today-s-best-policy-option

But to cut to the chase: OPEC will act to maximise the value of their oil,
and that means they will reduce their production to maximise flow x price.
Growth will fall in the OECD economies causing increases in budget deficits
and financial distress particularly for exporters. Faced with that dilemma,
Japan seems likely to be the first to try some form of "helicopter money".

One final thought: When you have no good choices, you have reached an
optimal solution ;-)

And on that thought, it's back to Rome until the next crisis  ....

[Tirapon]

@OP

Thanks for creating this thread. Its become difficult to find material worth reading around here; to find so much in one place is brilliant.