Chapter 1. Where can we look for better money: to the market or to the state? It is a myth that better money has always, and can only, come from government or other collective action. Theory and historical evidence indicate that the “state theory of money” is false: Private initiative gave rise to the earliest commodity monies to serve the needs of commerce. Although sovereign states commandeered the coinage in antiquity, not to improve it but to extract revenue, we provide the evidence that private mints worked well when and where they were allowed. Silver and gold coins were valued by weight, not by which ruler’s face was stamped upon them. Private currencies in the form of redeemable banknotes were the most popular form of payment in the nineteenth century, and their introduction preceded government paper currencies. Central banks in monopolizing the issue of currency and obstructing international specie flows did not improve the monetary system but the contrary. While contemporary [italic]fiat[/italic] money (non-commodity money issued by government) rests on the power of the state, gold and Bitcoin do not require the imprimatur of the sovereign to serve as good money.

The Roman monetary system was historically unique. Its complexity arose out of several intersecting and sometimes contradictory embedding contexts. This chapter identifies several important embedding contexts and provides a broad diachronic outline of their influence in the development of Roman money. Some of Rome’s Republican-era experiments with coinage, for example, were inescapably influenced by Greek practices and concepts. Roman territorial expansion seems to have been correlated with the rise of impersonal exchange in Rome, Italy and beyond – presenting unique cultural challenges for Roman elites in the Republican period. Notions of monetary value in the Roman Principate remained tethered to historical monetary contexts – but shifts in value and in the prominence of certain contexts over others could and did happen. Oscillations in the intensity and breadth of state power, for example, influenced money use, value and the scope for market exchange. It is impossible to import modern economic theory into Roman monetary history without first accounting for some of the key embedding contexts which shaped monetary practices, processes and concepts in the Roman world.