War and Peace, Imitation and Innovation, Backwardness and Development: The Beginnings of Coinage in Ancient Greece and Lydia

Abstract

The economic revolution produced by the invention of coinage was both conducive to and facilitated by a number of smaller, incremental innovations, some in the coin itself (the use of silver rather than electrum, the use of bronze for small amounts, fiduciary coinage), some in the ways of doing business (retail commerce, salaried labor, new credit systems such as the small lender, the bank, bottomry loans and transfer orders), some in the management of money (public finance). Paradoxically but not uncharacteristically, it was the more primitive Greek society that was more open to innovation, and that used the new coins in ways undreamed of in the more developed Near Eastern economies. War may have been what engendered the original innovation; peace was what nourished it, so that it grew and prospered.