Economic strategies against inflation: Historical journey through Anatolia

Economic crises, inflation and price hikes have been recurring issues throughout history, affecting societies and rulers alike. From the Roman Empire to the Ottoman era, Anatolia has seen a variety of strategies to tackle these challenges.

This article explores the economic reforms and strategies implemented by rulers to stabilize prices, maintain economic order, and prevent societal unrest in what is now modern-day Türkiye.

Roman era: Diocletian’s edict on ceiling prices

During the Roman Empire, Emperor Diocletian introduced one of the most comprehensive economic reforms in history. His Edictum de Pretiis Rerum Venalium (Edict on Ceiling Prices), issued in 301 A.D., was aimed at controlling inflation and stabilizing the economy in the face of rising prices.

• Reason for the edict: Diocletian attributed inflation to the greed of merchants and believed that the state should have a direct role in controlling wages and prices.
• Scope of the edict: The edict set price ceilings for over 1,200 goods and services, from basic food items like beef and mutton to skilled labor services such as sculpting and teaching.
• Penalties: Violating the edict resulted in harsh penalties, including death, reflecting the severity of the economic crisis.
• Economic impact: The edict, although ambitious, was eventually repealed due to opposition from merchants and the difficulty of enforcement.

Inflation and archaeological evidence in Türkiye

The edict’s inscriptions have been found in several ancient cities in Anatolia, providing valuable insight into the economic strategies of the time.

1. Stratonikeia (Mugla): Inscriptions on the walls of the parliament building reveal economic measures and price controls set by Diocletian’s edict. The wages of various workers, such as marble and mosaic craftsmen, were also inscribed, providing a clear picture of the labor market.
2. Aizanoi (Kutahya): Known as the site of the world’s first stock exchange, Aizanoi features inscriptions related to price regulations. The stone blocks used for trade were engraved with price lists based on Diocletian’s reforms. These inscriptions highlight the Roman efforts to stabilize the economy and curb merchant exploitation.
3. Aphrodisias (Aydin): One of the best-preserved copies of Diocletian’s edict is found on the facade of the Civil Basilica in Aphrodisias. The edict details the official value of silver coins, indicating that the wage level in 301 A.D. was five times higher than in 293 A.D., showcasing how inflation impacted wages and prices over a short period.

Here are some of the prices of goods and services in the Edict of Ceiling Prices promulgated in 301 A.D.

• Each teacher 50 denarii per male student
• Rhetoric and elocution teacher 250 denarii per student
• Marble worker (including food) 60 denarii per day
• Mosaic worker (including food) 60 denarii per day
• Palace guard (Praetorian) 5500 denarii per year
• Sculptor (including food) 70 denarii per day
• Domestic worker 50 denarii per day
• Private bath attendant 2 denarii per person coming to the hammam
• Beef (approx. 453 grams) 8 denarii
• Goat or mutton (about 453 grams) 8 denarii
• Vulva (sow’s breast – approx. 453 grams) 24 denarii
• Chicken (1 pair) 60 denarii
• Fish (best quality or caught from deep water – approx. 453 grams) 24 denarii
• Kenger, artichokes, etc. (good quality) five pieces 10 denarii
• Spelt (cleaned – approx. 8.5 kilograms) 100 denarii
• Honey (best quality – approx. 500 ml) 40 denarii
• Dry cheese (approx. 453 grams) 12 denarii
• Watermelon four pieces 4 denarii
• (Caracallis) Mantle with heel-length hood one piece 20 denarii
• Leather from Babylon (best quality) 500 denarii
• Transportation from Alexandria to Rome (per load of about 8.5 kilograms) 16 denarii
• Transportation from Alexandria to Ephesos (per load of about 8.5 kilograms) 8 denarii
• Transportation from Nicomedia to Ephesus (per load of about 8.5 kilograms) 6 denarii

Ottoman era: Struggles with inflation and economic reforms

Inflation was not only a problem during Roman times but also affected the Ottoman Empire. From the 16th century onward, the empire faced increasing economic pressure due to various factors such as wars, trade agreements, and foreign currency flooding Ottoman markets.

Early signs of inflation

1. Impact of foreign currency: The influx of foreign currencies, particularly after the geographical discoveries of the 15th century, led to price increases and devaluation of the Ottoman akce (Old Turkish lira). By the mid-16th century, inflation became a prominent issue.
2. Economic collapse (1569-1607): During this period, economic instability peaked. Revolts and famines caused a significant decline in wheat production, leading to skyrocketing bread prices. The rural population began abandoning their lands, deepening the crisis.

Late Ottoman economic reforms

1. Kucuk Kaynarca Treaty (1774): Following this treaty, the Ottoman Empire had to resort to internal borrowing, reflecting the state’s growing economic troubles. The value of the British pound soared against the Ottoman kurus (piaster), further exacerbating inflation.
2. Baltalimani Treaty (1838): This agreement allowed British goods to flood Ottoman markets, which contributed to the state’s increasing debt. The weakening Ottoman economy struggled to compete with the influx of foreign products, leading to price instability.
3. Muharrem Decree (1881): In a final effort to manage its growing debt, the Ottoman Empire issued the Muharrem Decree, effectively declaring bankruptcy. Foreign creditors took control of the empire’s revenues, marking the beginning of significant foreign intervention in Ottoman economic affairs.

Lessons from history: Enduring struggle against inflation

The history of inflation in Anatolia, from Roman to Ottoman times, highlights several key strategies that rulers have used to combat rising prices and economic instability:

• Price controls: Both Roman and Ottoman rulers tried to impose price ceilings to curb inflation, as seen in Diocletian’s edict and Ottoman efforts to stabilize the economy through treaties and reforms.
• Currency reforms: Changes in the value of currency played a major role in managing inflation, as evident in both Diocletian’s reforms and the Ottoman’s response to foreign currency influx.
• Economic centralization: Rulers often sought to centralize economic control, whether through Diocletian’s edict that made the state the dominant force in wage adjustments or the Ottoman Empire’s efforts to manage its debts.

Continuous economic challenge

From ancient Rome to the Ottoman Empire, the struggle against inflation has been a constant theme in the history of Anatolia. These historical measures, though often difficult to implement and enforce, offer valuable lessons for managing modern economic crises in Türkiye today.

Whether through price controls, currency reforms, or centralized economic strategies, the battle against inflation remains as relevant today as it was in ancient times.