Inflation and the Second Punic War

Editor’s note: my friend and colleague Jona Lendering recently posted the below article on his personal blog. I thought it would be of interest to readers of Ancient Warfare and, with Jona’s permission, I have translated and slightly edited it, so that you, too, can enjoy it.

The Dutch news website recently wrote the following as regards currency depreciation:

Consumers don’t lose any sleep over the daily news items that the euro has decreased in value again compared to the dollar or the pound. They don’t notice this at all. The shopping cart with their groceries is exactly as expensive now as it was before, and their salary is still worth the same as when the euro was stronger.  

Currency depreciation would indeed be this simple if our economy was a closed system.

The Second Punic War

Sometimes, it is indeed this simple. An example is the Roman Republic during the Second Punic War. Rome had been attacked by the Carthaginian commander Hannibal and suffered a number of shocking defeats: in the Po Valley (218 BC), at Lake Trasimene (217), and at Cannae (216).

In order to continue the war, the Romans needed extra troops and resources. In order to cover these expenses, they needed more money. And in order to create more money, Roman minters used the available silver to simply create more coins – in other words, the amount of silver in the coins decreased and the Roman currency depreciated.

After just one year, the traditional silver coin, the quadrigatus, was worth about half of what it had been before, and the value decreased even further in the following year. In 214 or 211 BC, when the war entered its fifth or eighth year, the entire system of coinage, which no one had any faith in anymore, was revised. A new coin was introduced: the denarius. In other countries, engaged as they were in the Fourth Syrian War, inflation was just as much of a problem.

Rome was able to finance the war this way because importing goods was relatively unimportant, so they only rarely had to buy something at a much steeper cost. Rome’s soldiers could thus continue to pay the same amount for their groceries as they had before and their pay hadn’t markedly decreased in value compared to the time before the war had broken out.

Carthage did suffer from inflation, as they relied to a large degree on the services of foreign mercenaries. In other words, Carthage had to import soldiers and the fact that their coins had decreased in value made them more expensive. Inflation thus made the war more difficult to finance. In addition, Carthage also needed to import strategically valuable products that were becoming ever more expensive, while Rome continued to be in control of the metal mines in Tuscany.

The importance of inflation

Inflation thus played an important part in the first years of the Second Punic War. Rome was able to keep up better than Carthage. It’s difficult to decide whether or not this was a determining factor in the war. Whatever the case may be one thing is certain: for the outcome of the conflict, currency depreciation was more important than the battles in the Po Valley, at Lake Trasimene, or at Cannae, which were only important as far as the course of the war was concerned. The battles draw our attention because they have been described in great detail in our sources, but that doesn’t mean they were actually important.

The usually implicit assumption that what’s mentioned in our sources is also important is what we refer to as the ‘positivist fallacy’. A I remember that when my teacher, Prof De Neeve, explained this principle he used the example of the relative importance of the battles mentioned earlier for the outcome of the Second Punic War. How he spoke about this inflation that has not been mentioned in the written sources was for me, as an eager freshman at university, nothing short of a revelation: so that’s how you deal with different categories of evidence.

The importance of inflation for the outcome of ancient wars can be considered a conclusion typical of the twentieth century. One reason is that numismatists (those who study coins) have described the depreciation of coins in great detail. If I am not mistaken, currency depreciation during the Second Punic War has been known since the fifties, with Chris Howgego of the Ashmolean Museum putting the finishing touches to the idea in the nineties. A second reason is that economic history was popular in the previous century and that military historians still take economic factors into account when they analyse ancient wars.

Does this change our image of the war? Well, the outcome remains the same: Rome won. It also doesn’t change the significance of the war: Rome increased its might in such a way that it disrupted the balance of power and that the unification of the Mediterranean under Roman rule had become inevitable.

At the same time we do understand better than before just how far Rome had to go to achieve victory. A story about inflation is at least as interesting as the annoyingly often retold story of Hannibal, and certainly a lot more interesting. Modern ancient history doesn’t just develop different insights into the past, but also better ones.

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