CoinWeek Ancient Coin Series by Mike Markowitz….
Throughout the history of coinage two contradictory concepts have competed with each other. According to one concept, a coin is a piece of precious metal whose value is essentially equivalent to the value of the bullion from which it was made, and the stamp on its face is merely a guarantee that it has (or had when minted) a particular weight and purity. According to another, a coin is a token whose value depends entirely on people’s willingness to accept it in exchange for other items. Its weight and fineness are of no intrinsic interest, except for the fact that if a coin is too valuable people will be tempted to melt it down for bullion.--David Schaps, “What Was Money in Ancient Greece?”
ONE OF THE MOST frequently asked questions that classical numismatists encounter is “What was this ancient coin worth back then?”
A meaningful answer must usually begin: “It’s complicated.” A more complete answer might include “It depends…”
In our global economy, where almost everything is instantly convertible into cash, we can state precise exchange rates: one US dollar is worth 0.87 euro or 0.95 Swiss francs, or 0.65 British pounds. But what is today’s value of a US dollar in terms of ancient Athenian drachmai, or ancient Roman sestertii? When an ancient Roman had a silver denarius in his purse, what could he buy with it? Ancient economies did not work like modern ones, and ancient writers, almost all slave-owning aristocrats who belonged to privileged elites, rarely wrote about the vulgar topic of money.
Bullion Equivalent Value
Ancient coins, like medals in the modern Olympic games, come in gold, silver and bronze. Can’t we simply express equivalent ancient and modern values in terms of precious metal? Gold closed this week at US$1,142 per Troy ounce, so a 7.0-gram ancient Greek gold stater from the time of Alexander the Great (died 323 BCE) represents a bullion value of $262.87. An 8.18-gram Roman gold aureus from the time of Julius Caesar (died 44 BCE) would contain gold worth $307.18.
The spot price of silver is $15.55 per Troy ounce. At this price, the silver in an Athenian tetradrachm (the most important trade coin in the Mediterranean world of the fifth century BCE) would be worth $8.60, and a denarius of the Roman Republic from the time of Julius Caesar would be worth about $2 (these coins were nearly pure silver; modern silver coins are typically alloyed with about 10% copper for improved wear resistance).
But “bullion equivalent value” is a very shaky basis for comparing buying power across the centuries. We are comparing gold that was mined with slave labor and refined in charcoal-fired furnaces to gold that is mined with huge diesel-powered shovels and refined with modern physical and chemical methods. In the ancient world, copper alloys (bronze and brass) formed tools, weapons, statues, cooking vessels and countless other non-coinage uses. In our world, copper is a commodity used mainly for electric wiring .
Labor Equivalent Value
We know from many sources that a silver drachma or denarius was a typical day’s minimum wage for a manual worker. Taking today’s US$7.25 minimum hourly wage for comparison, a day’s labor would be worth $58. Keep in mind that when we compare labor equivalent values across the centuries, we are comparing an ancient world where muscle power was a primary energy source, to a modern world largely powered by engines, motors and data networks. In our world a small and diminishing number of farmers can each feed themselves and over 50 others. In the ancient world, most workers were farmers and they struggled to feed themselves and a few others.
Another way of thinking about labor equivalent is soldier’s pay – one of the most important items in the budget of ancient empires. In the fourth century BCE, Greek hoplites (armored infantry) typically received a drachma per day (sometimes supplemented by another drachma to pay for a servant while on campaign). Computed as an annual salary, this represents about 1,540 grams of silver or, converted into gold at the typical ancient 15:1 rate, 103 g of gold (about three-and-a-third troy ounces).
Roman soldiers were paid 225 denarii per year, beginning in the first century BCE and continuing until the reign of the emperor Domitian (ruled 81-96 CE), who raised the rate to 300 denarii. That would represent about 972 grams of silver or 64.8 grams of gold (a bit over two troy ounces).
Now consider a modern soldier’s pay. A US Army E-2 with less than two years service earns a base pay of $20,808. That would buy over 40 kilograms of silver, or about 555 grams (18.2 troy ounces) of gold at current rates. So in terms of the gold standard, Americans value a foot soldier more than five times as highly as ancient Greeks, and more than eight times as much as ancient Romans did.
Diocletian’s Price Edict
A failed Roman imperial experiment in price controls in the early fourth century CE gives us a remarkably detailed snapshot of what money was worth, at least “officially”.
The runaway inflation of the anarchic late third century had ruined the Roman people’s trust in their increasingly debased currency. The economy was a mess. Diocletian, a tough military commander, thought he could simply issue orders to make wages and prices fall into line throughout the Empire. Everything would be priced in terms of a new theoretical unit, the denarius communis or d.c. A new high quality silver coin, the argenteus, was worth 100 d.c, and the gold aureus was worth 1,200.
On surviving fragments of the “Edict on Maximum Prices” we have prices for over a thousand different services and commodities. Laborers earned 25 d.c. per day. A barber was paid 2 d.c. per haircut. A lawyer could charge 1,000 for pleading a case. Including various benefits and subsidies, the annual salary for a legionary soldier was 15,400 d.c., and a member of the Praetorian Guard got 19,100.
Wheat sold for 100 d.c. per modius (a measuring bucket that held about eight liters or two gallons, enough to make 20 one-pound loaves of bread) Meat was sold by the Roman pound or libra of 12 ounces (326 grams): pork and lamb for 12 d.c.; beef for 8; high-quality saltwater fish for 25; chicken (a luxury!) for 60.
Clothing was costly. A soldier’s tunic cost 75; his boots, 100. A good cloak cost 500. The highest priced item on record is purple silk, reserved for the Imperial household, at 150,000 dc per pound. This was also the price of a lion, if you happened to be in the market for one.
Diocletian decreed the death penalty for sellers and buyers who violated his maximums.
It didn’t work, of course. Unenforceable, within a few years the edict was ignored, and the engraved stone tablets set up in the markets were recycled as building blocks — which is how the text survived.
Ancient economies were largely “bimetallic.” Elites used gold coin, for purchases of luxury goods, property, and slaves. Silver coin typically circulated for the payment of wages, and bronze token coinage circulated for the purchase of daily necessities. At the risk of oversimplification, we can think of a small copper as the price of a loaf of bread, a pure silver coins as a worker’s daily wage, and a gold coin as the price of a good horse.
Modern currency is primarily “fiat money”, with a value determined by government, while ancient money was largely “commodity money”, with values determined by the supply and demand of precious metals.
 The Monetary Systems of the Greeks and Romans. W.V. Harris, ed. Oxford (2008). Print. 47.
 Posted rates as of 14 October 2015.
 Ancient garments did not have pockets. You typically kept your coins in a leather pouch, tucked into your belt.
 One Troy ounce is 31.103 grams.
 Bullion prices as of the close of business on Friday, 30 October 2015.
 On the London Metal Exchange, the price of copper was $5,135 per tonne on 30 October 2015.
 Ancient laborers probably worked more than an eight-hour day. The duration of the workday varied seasonally, according to the available daylight.
 Less than two percent of the US population is employed in agriculture.
 A hoplite was expected to provide his own armor and weapons, at a cost of 300 to 500 drachmai, but if he survived these would last for many years. In an era of relatively static technology, military equipment was often passed down from father to son.
 In practice this is usually increased significantly by various allowances such as housing.
 Bucephalus, the famous horse tamed and ridden by Alexander the Great, cost 13 talents, equivalent to 78,000 silver drachmai. The highest price on record for a modern horse is US$16 million.
 This has nothing to do with the Italian car: https://en.wikipedia.org/wiki/Fiat_money.
Dalka, Mike. “What Things Cost in Ancient Rome”. Online at Ancient Coins for Education: http://ancientcoinsforeducation.org/content/view/79/98/
Ferguson, Niall. The Ascent of Money: A Financial History of the World. Penguin (2008)
Finley, Moses. The Ancient Economy. California (1973)
Graser, E.R., “A text and translation of the Edict of Diocletian”, An Economic Survey of Ancient Rome Volume V: Rome and Italy of the Empire (1st ed.). T. Frank, ed. Baltimore: (1940)
Harl, Kenneth. Coinage in the Roman Economy: 300 BC to AD 700. Johns Hopkins (1996)
Hendin, David. Guide to Biblical Coins, 5th ed. Amphora (2010)
Schaps, David. “What Was Money in Ancient Greece?”, The Monetary Systems of the Greeks and Romans. W.V. Harris, ed. Oxford (2008).