Co-evolution of Roman Law and Economy

In respect of one of the fundamental questions of legal history—why and how legal systems change?—Bruce Frier observes: ‘“Why” refers to the initial impulses and the motives for legal change; “how” refers to the factors conditioning the form that legal change takes.’¹'¹¹ The answer to the second part of the question (‘how’) is largely to be found within the legal system itself.

The Roman jurists, praetors, and emperors would primarily try to fill perceived gaps in the law in a manner which was consistent with the existing legal framework.^² The evolution of Roman law can, therefore, not be treated as simply mirroring the evolution of the Roman economy.¹⁴³ At the same time, however, without ‘irritations’ from its economic environment there would not have been sufficient stimuli for the evolution of Roman law to its classical state. The answer to the first part of the question (‘why’) is, therefore, largely to be found in the legal system’s environment, in particular the economy. Moreover, the legal system may have contributed to the functioning of the economic system by offering a differentiated and versatile set of principles and rules, allowing the law effectively to deal with the complexity of its economic environment.^ From a legal perspective we can learn a lot about the evolution of law by studying the economy. From an economic perspective, by studying law, we can also learn something about the nature of the economy. Thus the sophistication of the Roman law of secured credit does shed light on the alleged ‘primitive’ nature of the Roman economy.

Roman law in a weakly cultivated economic environment?

In her Romische Rechtsgeschichten, Marie-Theres Fogen holds that as a system Roman law was ‘a lonely highly cultivated plant in the midst of a systemically

no Smith, Gabora, and Gardner-O’Kearny 2018: 84.

m Frier 1986: 888.

142 Frier 1986: 888-9.

143 Similar views are expressed (for modern legal systems) by Teubner 1988: 232; Amstutz 2001: 103; Tamahana 2017: 113; Vesting 2018a: 152-3.

in The legal system offers ‘cognitive resources which, in their turn facilitate economic transactions’ (Deakin 2011: 119).

weakly cultivated environment’.^[119] ^{^[120] ^[121] Fogen observes that Roman law was only moderately cognitively open in relation to economic manifestations. The legal system came up with the contract of sale when money was invented and with the maritime loan when Roman ships began sailing the Mediterranean, but otherwise, there were no demands from the economy, because there was no Roman economy. There were economic relationships within the family, and there was a social structure: both were protected by the law in the form of principles and rules on inheritance, tutelage, adoption, and dowry. The evolution of Roman law presumably was made possible by the fact that for a long time a co-evolution between the law and other social subsystems failed to happen. The law was, Fogen observes, largely exempted from labour-intensive, irritating interactions and couplings in need of attention. From a safe house, guarding it from criticism, hostilities and reproaches, the law could self- referentially specify itself almost autistically. Fogen is right where she observes that the image of a ‘safe house’ was particularly appropriate for the relationship between law and politics. The political system could have used the law as an instrument to realize political purposes, which it only incidentally did, and even have dominated it, which—certainly in the law of property and the law of contract—it failed to do (even after the codification of the praetor’s edict and the distinct change of the imperial rescript practice under Hadrian).¹'¹⁶ As far as the co-evolution of law and economy is concerned, however, Fogen seriously underestimates the nature and significance of the Roman economy and the ‘irritations’ which it must have caused for the legal system.^⁷}

Roman economy as a subsystem of society?

Fogen’s perception of the Roman economy has a respectable pedigree.

For more than a century the Roman economy is the object of the so-called Bücher/Meyer Controversy between ‘primitivists’ and ‘modernists’. The original version of the primitivist doctrine, as forwarded by Karl Bücher in 1893, holds that the Roman economy was a ‘very simple, small-scale, closed household economy aimed at self sufficiency and engaged only in very limited exchanges with other households’.^[122] ^{^[123] ^[124] ^[125] ^[126] ^[127] ^[128] ^[129] This is in stark contrast to the modernist view of the Roman economy, as originally defended by Eduard Meyer, pursuant to which the Roman economy was very similar to the economies of early modern Europe but only was much smaller. In the twentieth century the controversy continued, although on neither side would one still fully adhere to the original positions.14⁹ In The Social and Economic History of the Roman Empire, Rostovtzeff collected an enormous amount of archaeological, epigraphical, numismatic, and other empirical data, which led him to believe that the Roman economy did not fit in the primitivist model of Bücher. In a book review Rostovtzeff made the following—often quoted—remark: ‘I am certain that the differences with respect to the modern economy were only quantitative, not qualitative?⁵⁰ According to Rostovtzeff, ‘the main source of large fortunes' was commerce. The law of secured credit played a significant role in generating wealth: ‘Money acquired by commerce was increased by lending it out mostly on mortgage, and it was invested in land.’ Commercial exchanges were significant and not confined to small local circles, but took place within a ‘world economy’151 In The Ancient Economy, Finley adopted an entirely different model. Finley denied that the ancient economies of Greece and Rome were subject to modern economic principles and played down the role of commerce and finance.
15² The Greeks and Romans ‘lacked the concept of an economy’ as well as ‘the conceptual elements which together constitute what we would call “the economy” ’ They did of course farm, manufacture, sell, lend and borrow money, and write about these activities, but they did not ‘combine these particular activities conceptually into a unit, in Parsonian terms into “a differentiated sub-system of society”’.¹⁵'¹ This was not merely ‘an intellectual failing’, but rather ‘the consequence of the structure of ancient society’.^ The most fundamental concept of a modern economy, that of the market, was absent from Roman society. There was no labour market, money market, etc., in which individuals were active whose preferences can be analysed with modern investment models.¹'⁵'⁵ According to Finley, the justification for using the term ‘ancient economy' can only be found in ‘reasons which have little or nothing to do with the economy'. For this reason, one has ‘to seek different concepts and different models, appropriate to the ancient economy, not (or not necessarily) to ours'.^[130] ^{^[131] ^[132] ^[133] ^[134] Even if Finley's minimalist interpretation of the Roman economy is right and one cannot speak of a Roman economic subsystem, this does not prevent us from using systems theory to analyse the interactions between the differentiated legal system with its (undifferentiated) environment.15⁷ Certainly when one's prime interest is in how the evolution of Roman law was influenced by ‘economic' factors, it does not matter whether or not these factors are produced within a differentiated economic subsystem of the legal system's environment. What matters is that Roman law can be regarded as a legal system (in the Luhmannian sense), which is both cognitively open and operatively closed at the same time. This provides the analytical framework for examining how the evolution of Roman law was influenced by factors coming from its (economic or other) environment.
A legal perspective
Although many contemporary historians of the Roman economy profess to distance themselves from it,^⁸ in reality it would appear that the Bücher/ Meyer controversy is still alive.15⁹ The school of thought which in the Oxford Handbook of Roman Studies is considered as the most influential still has primitivist connotations. It considers the Roman economy as ‘a highly localized, fragmented, and largely agrarian economy that sustained a thin veneer of coerced transfers and trade in luxuries and a network of towns that were dominated by landowning elites?⁶⁰ A modernist stance has been taken by economist Peter Temin, who recognizes that not all transactions were market exchanges and that even a substantial part of economic activity would be carried on within Roman households. Temin does not deny that markets are embedded in society, but this does not prevent him from concluding that the Roman economy was a market economy, albeit not ‘the market economy of elementary textbooks’. Rather the Roman economy was like that of other advanced agricultural economies, such as those of seventeenth- and eighteenthcentury England and the Dutch Republic.¹⁶¹
A legal perspective points towards a more modernist orientation. According to Schiavone the Roman economy was characterized by ‘dual equilibria’, formed by an ‘archaic’ and ‘advanced’ form of economy.¹''² In the archaic period economic relationships were clearly ‘Finleyan’: ‘In every transaction, a bundle of expectations and interests comes into play that could never be reduced to pure economic quantification?'³ However, where according to Finley nothing fundamentally changed in the period from 700 bc to 250 ad, Schiavone holds that if one looks at the mature Roman imperial economic system the picture drastically changes. After the second Punic war economic developments were set in motion which led to several ‘areas of innovation, from which there was no turning back?'⁴ There was a noticeable increase in trade, both regional and interregional, accompanied by the formation of ‘new social classes with specifically mercantile interests’ and the ‘accumulation of a substantial amount of commercial capital?'⁵ This increase in trade had a substantial impact on the institutions of the Republic, in particular resulting in the creation of the office of the praetor peregrinus, which developed a body of legal rules applicable to commercial transactions with non-Romans (to whom the ius civile did not apply).
Many legal innovations in Roman contract law—in particular the consensual contracts—find their origin in commercial transactions entered into via Mediterranean trade circuits between Romans and foreigners. They were submitted to the praetor peregrinus, who granted new actions to enforce these transactions. At a later stage these new contractual forms were also recognized by the praetor urbanus and incorporated into the law for the Roman citizens (ius civile).¹⁶⁶ The law of pledge, although it did not evolve under the jurisdiction of the praetor peregrinus, must also be counted among the ‘areas of innovation’ coming into existence in response to the economic developments taking place after the second Punic war. As we will see in chapter 4, Rome’s ‘Economic Revolution’ was accompanied by the emergence of almost all the specific remedies that 1'1 Temin 2013: 8.
1'2 Schiavone 2000: 66. Cf. also Camodeca 2003: 96 (endorsed by Andreau 2003: 281) who holds that Roman economic and financial life was a mixture of ‘modern’ and ‘archaic’ elements and that it was precisely this which gave the Roman economy its distinctive nature.
1'³ Schiavone 2000: 56. 1'4 Schiavone 2000: 56.
1'5 Schiavone 2000: 56. See also chapter 3.
1'' Schiavone 2000: 56. Recently De Ligt (2020: 88-9) has pointed out that before 242 bc there was only one praetor, who must have dealt with Roman and foreign litigating parties. became available for pledge creditors or pledge debtors: interdictum Salvianum, interdictum de migrando, and, most importantly, the actio Serviana. Here also these legal innovations were preceded by transactional practices, as shown in Cato's De agricultura, some of which may have Hellenistic origins.
According to Richerson and Boyd, ‘adaptionist reasoning can be run “backward”—we can predict past environments from present behaviour’.^[135] ^{^[136] ^[137] ^[138] ^[139] ^[140]} Likewise, evolutionary reasoning can be used to predict past economic environments from past legal institutions. Thus evolutionary reasoning can shed light—from a legal angle—on the Bücher/Meyer Controversy. Certainly classical Roman law did offer a legal framework sophisticated enough for a market economy in which finance plays an important roleTh⁸ If that is so, one wonders how likely it is that an empire with a primitive, ‘Finleyan' economy would develop a highly versatile and differentiated law of secured credit? More generally, if one accepts that the legal system—albeit in its own ‘autopoietic' way—responds to impulses from its economic environment, it would seem highly unlikely that a ‘thin veneer of coerced transfers and trade in luxuries' would provide sufficient stimuli for the evolution of the complex Roman private law of the late Republic and the PrincipateTh⁹
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Source: Verhagen Hendrik L.. Security and Credit in Roman Law: The Historical Evolution of Pignus and Hypotheca. Oxford University Press,2022. — 448 p.. 2022

Co-evolution of Roman Law and Economy

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