Your Introduction to Ancient Egyptian Economics
When it comes to learning about the rise and formation of the modern economy, it's tempting to start your education back in the halls of Ancient Egypt, where the power of the day established a command economy to lead the way for the future. Although the Egypt from centuries ago didn't have all of the modern conveniences that we appreciate today, it still ran with a focus on efficient financial performance.
Taxes were collected, storage and redistribution were common practices, and regional facilities were equipped to step in if a crisis hit any specific field.
Ancient Egypt was primarily made up of autarkic domains. When taxes were paid, administrators from each household were able to store the surplus they had in their domain for the future or exchange them for other products through bartering. While the percentage of manufactured goods and produce to reach the market was relatively small, it was an important part of Egypt's economy.
Where Did Egypt Find its Wealth?
The wealth of ancient Egyptians came from many different industries, with the farming and fishing economy being the strongest. The location was ripe with cattle, fruits, vegetables, and grain that could be shared throughout various markets. Soil was fertile, but agricultural practices were poor, which meant that Egyptians frequently struggled to find new ways of raising profits.
Some other areas of wealth for the economy included:
Manufacturing: Many households divided manufacturing labour by gender. For instance, while the men grew flax in the fields, women spun it into linen to be sold in the markets. Small factories were common in ancient Egypt, with some featuring a few dozen employees at a time.
Mining: Precious metals weren't common in Egypt, and they were rarely used for jewellery. Instead, mining was a process designed to create tools that were crucial for weaponry and manufacturing. Though wooden and stone tools remained the most common option for most.
Banking: It's difficult to think of Ancient Egypt as a banking powerhouse, but there was a central bank in Alexandria that recorded the accounts of granary banks around the country. High-interest rates meant that banking wasn't as common as it is today, but it's a useful insight into where our behaviour with money began. The interest rates paid on instant lending by the Egyptians was similar to the no credit check options available today.
Energy: Electricity and gas weren't common resources in Ancient Egypt, but money could be made selling the muscle power of domesticated animals, and even humans. Fire and the heat of the sun were also powerful tools for the creation of new economic products.
Warfare: Military ventures were often a source of income for the ancient Egyptians. The country was fortunate in their efforts with war until the later periods, when it was under the attack of stronger countries from across the seas. Despite Cleopatra's efforts to remain independent, Rome became the most dominant force in the world.
The Taxes of Ancient EgyptJust as Egypt has a great deal to teach us about the rise of banking and the popularity of different industries across the centuries, it also has lessons to share about taxation too. Many consider ancient Egypt to have been one of the most heavily taxed nations in the world. In fact, some believe that the country eventually collapsed under the weight of the taxes placed upon the general population.
Despite the stress of taxes, the country survived almost unchanged for over two millennia. The state relied on the money it brought in from labour, and the taxes of the public and grain was the most important produce collected by authority figures, as it was easy to store and crucial to long-term durability.
Who Benefitted from Egypt's Economy?
Although a significant amount of money was devoted to building temples and places of worship, many of the taxes imposed on the public were designed to keep society steady and strong. For instance, it meant that grain could be stored and distributed in times of famine, and few people were left with nothing. While different people in certain classes benefitted more than others, there wasn't much difference regarding the health and survival of different classes.
Is in most economic societies, of course, the famines of Egypt had a bigger impact on poor families than the rich. However, Egypt was one of the few places to take care of all of its citizens as best it could. Anyone could rise on the social and economic ladder with the right amount of hard work and thrift.
Today, people still believe that there is much to be learned from the economic structure of ancient Egypt.