Heterodox
145-398: In macroeconomics , chartalism is a heterodox theory of money that argues that money originated historically with states' attempts to direct economic activity rather than as a spontaneous solution to the problems with barter or as a means with which to tokenize debt, and that fiat currency has value in exchange because of sovereign power to levy taxes on economic activity payable in
290-693: A fixed exchange rate regime, aligning their currency with one or more foreign currencies, typically the US dollar or the euro . Conventional monetary policy can be ineffective in situations such as a liquidity trap . When nominal interest rates are near zero, central banks cannot loosen monetary policy through conventional means. In that situation, they may use unconventional monetary policy such as quantitative easing to help stabilize output. Quantity easing can be implemented by buying not only government bonds, but also other assets such as corporate bonds, stocks, and other securities. This allows lower interest rates for
435-635: A fixed exchange rate system or even a currency union like the Economic and Monetary Union of the European Union , drawing on the research literature on optimum currency areas . Macroeconomics as a separate field of research and study is generally recognized to start with the publication of John Maynard Keynes ' The General Theory of Employment, Interest, and Money in 1936. The terms "macrodynamics" and "macroanalysis" were introduced by Ragnar Frisch in 1933, and Lawrence Klein in 1946 used
580-413: A medium of exchange but as a standard of deferred payment , with government money being debt the government could reclaim by taxation. Innes argued: Whenever a tax is imposed, each taxpayer becomes responsible for the redemption of a small part of the debt which the government has contracted by its issues of money, whether coins, certificates, notes, drafts on the treasury, or by whatever name this money
725-405: A priestly role . He could not marry a woman from a senatorial family, nor achieve legitimate senatorial rank himself, but during the early Empire, freedmen held key positions in the government bureaucracy, so much so that Hadrian limited their participation by law. The rise of successful freedmen—through political influence or wealth—is a characteristic of early Imperial society. The prosperity of
870-436: A 2% inflation rate just because that has been the average the past few years; they will look at current monetary policy and economic conditions to make an informed forecast. In the new classical models with rational expectations, monetary policy only had a limited impact. Lucas also made an influential critique of Keynesian empirical models. He argued that forecasting models based on empirical relationships would keep producing
1015-468: A 3% increase in output would lead to a 1% decrease in unemployment. The structural or natural rate of unemployment is the level of unemployment that will occur in a medium-run equilibrium, i.e. a situation with a cyclical unemployment rate of zero. There may be several reasons why there is some positive unemployment level even in a cyclically neutral situation, which all have their foundation in some kind of market failure : A general price increase across
1160-804: A basis for making economic forecasting . Well-known specific theoretical models include short-term models like the Keynesian cross , the IS–LM model and the Mundell–Fleming model , medium-term models like the AD–AS model , building upon a Phillips curve , and long-term growth models like the Solow–Swan model, the Ramsey–Cass–Koopmans model and Peter Diamond 's overlapping generations model . Quantitative models include early large-scale macroeconometric model ,
1305-613: A broader class of assets beyond government bonds. A similar strategy is to lower long-term interest rates by buying long-term bonds and selling short-term bonds to create a flat yield curve , known in the US as Operation Twist . Fiscal policy is the use of government's revenue ( taxes ) and expenditure as instruments to influence the economy. For example, if the economy is producing less than potential output , government spending can be used to employ idle resources and boost output, or taxes could be lowered to boost private consumption which has
1450-533: A certain proportion of his taxes should be paid in a paper money of a certain kind, might thereby give a certain value to this paper money; even though the term of its final discharge and redemption should depend altogether on the will of the prince. Forstater also finds support for the concept of tax-driven money, under certain institutional conditions, in the work of Jean-Baptiste Say , John Stuart Mill , Karl Marx and William Stanley Jevons . Alfred Mitchell-Innes , writing in 1914, argued that money existed not as
1595-571: A core part of contemporary macroeconomics. The 2007–2008 financial crisis , which led to the Great Recession , led to major reassessment of macroeconomics, which as a field generally had neglected the potential role of financial institutions in the economy. After the crisis, macroeconomic researchers have turned their attention in several new directions: Research in the economics of the determinants behind long-run economic growth has followed its own course. The Harrod-Domar model from
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#17327728661791740-425: A fifth of the population and played a major role in the economy. Slavery was a complex institution that supported traditional Roman social structures as well as contributing economic utility. In urban settings, slaves might be professionals such as teachers, physicians, chefs, and accountants; the majority of slaves provided trained or unskilled labour. Agriculture and industry, such as milling and mining, relied on
1885-640: A fine for a crime for which an humilior might receive a scourging . Execution, which was an infrequent legal penalty for free men under the Republic, could be quick and relatively painless for honestiores , while humiliores might suffer the kinds of torturous death previously reserved for slaves, such as crucifixion and condemnation to the beasts . In the early Empire, those who converted to Christianity could lose their standing as honestiores , especially if they declined to fulfil religious responsibilities, and thus became subject to punishments that created
2030-425: A freedman were born free, with full rights of citizenship. After manumission, a slave who had belonged to a Roman citizen enjoyed active political freedom ( libertas ), including the right to vote. His former master became his patron ( patronus ): the two continued to have customary and legal obligations to each other. A freedman was not entitled to hold public office or the highest state priesthoods, but could play
2175-629: A high-achieving group of freedmen is attested by inscriptions throughout the Empire . The Latin word ordo (plural ordines ) is translated variously and inexactly into English as "class, order, rank". One purpose of the Roman census was to determine the ordo to which an individual belonged. Two of the highest ordines in Rome were the senatorial and equestrian. Outside Rome, cities or colonies were led by decurions , also known as curiales . "Senator"
2320-571: A higher social class. Most of the emperors were bilingual but had a preference for Latin in the public sphere for political reasons, a "rule" that first started during the Punic Wars . Different emperors up until Justinian would attempt to require the use of Latin in various sections of the administration but there is no evidence that a linguistic imperialism existed during the early Empire. After all freeborn inhabitants were universally enfranchised in 212 , many Roman citizens would have lacked
2465-401: A household or workplace, a hierarchy of slaves might exist, with one slave acting as the master of others. Talented slaves might accumulate a large enough peculium to justify their freedom, or be manumitted for services rendered. Manumission had become frequent enough that in 2 BC a law ( Lex Fufia Caninia ) limited the number of slaves an owner was allowed to free in his will. Following
2610-472: A knowledge of Latin. The wide use of Koine Greek was what enabled the spread of Christianity and reflects its role as the lingua franca of the Mediterranean during the time of the Empire. Following Diocletian's reforms in the 3rd century CE, there was a decline in the knowledge of Greek in the west. Spoken Latin later fragmented into the incipient romance languages in the 7th century CE following
2755-522: A lasting influence on the development of language , religion , art , architecture , literature , philosophy , law , and forms of government across its territories. Latin evolved into the Romance languages while Medieval Greek became the language of the East. The Empire's adoption of Christianity resulted in the formation of medieval Christendom . Roman and Greek art had a profound impact on
2900-459: A man as an equestrian. The census of 28 BC uncovered large numbers of men who qualified, and in 14 AD, a thousand equestrians were registered at Cádiz and Padua alone. Equestrians rose through a military career track ( tres militiae ) to become highly placed prefects and procurators within the Imperial administration. The rise of provincial men to the senatorial and equestrian orders
3045-560: A married woman could have sex only with her husband, but a married man did not commit adultery if he had sex with a prostitute or person of marginalized status. Childbearing was encouraged: a woman who had given birth to three children was granted symbolic honours and greater legal freedom (the ius trium liberorum ). At the time of Augustus, as many as 35% of the people in Roman Italy were slaves, making Rome one of five historical "slave societies" in which slaves constituted at least
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#17327728661793190-442: A medium-run equilibrium (or "potential") level, the process would be slow at best. Keynes coined the term liquidity preference (his preferred name for what is also known as money demand ) and explained how monetary policy might affect aggregate demand, at the same time offering clear policy recommendations for an active role of fiscal policy in stabilizing aggregate demand and hence output and employment. In addition, he explained how
3335-420: A parallel division of macroeconomic policies into short-run policies aimed at mitigating the harmful consequences of business cycles (known as stabilization policy ) and medium- and long-run policies targeted at improving the structural levels of macroeconomic variables. Stabilization policy is usually implemented through two sets of tools: fiscal and monetary policy. Both forms of policy are used to stabilize
3480-427: A sense of "Romanness". Roman society had multiple, overlapping social hierarchies . The civil war preceding Augustus caused upheaval, but did not effect an immediate redistribution of wealth and social power. From the perspective of the lower classes, a peak was merely added to the social pyramid. Personal relationships— patronage , friendship ( amicitia ), family , marriage —continued to influence politics. By
3625-498: A similar effect. Government spending or tax cuts do not have to make up for the entire output gap . There is a multiplier effect that affects the impact of government spending. For instance, when the government pays for a bridge, the project not only adds the value of the bridge to output, but also allows the bridge workers to increase their consumption and investment, which helps to close the output gap. The effects of fiscal policy can be limited by partial or full crowding out . When
3770-513: A slave's rapist had to be prosecuted by the owner for property damage under the Aquilian Law . Slaves had no right to the form of legal marriage called conubium , but their unions were sometimes recognized. Technically, a slave could not own property, but a slave who conducted business might be given access to an individual fund ( peculium ) that he could use, depending on the degree of trust and co-operation between owner and slave. Within
3915-545: A special case of the more general Ramsey growth model , where households' savings rates are not constant as in the Solow model, but derived from an explicit intertemporal utility function . In the 1980s and 1990s endogenous growth theory arose to challenge the neoclassical growth theory of Ramsey and Solow. This group of models explains economic growth through factors such as increasing returns to scale for capital and learning-by-doing that are endogenously determined instead of
4060-403: A whole intellectural framework - a novel theory of economics that explained why markets might not clear, which would evolve into a school of thought known as Keynesian economics , also called Keynesianism or Keynesian theory. In Keynes' theory, aggregate demand - by Keynes called "effective demand" - was key to determining output. Even if Keynes conceded that output might eventually return to
4205-547: Is affected. Expansionary monetary policy lowers interest rates, increasing economic activity, whereas contractionary monetary policy raises interest rates. In the case of a fixed exchange rate system, interest rate decisions together with direct intervention by central banks on exchange rate dynamics are major tools to control the exchange rate. In developed countries, most central banks follow inflation targeting , focusing on keeping medium-term inflation close to an explicit target, say 2%, or within an explicit range. This includes
4350-545: Is an aspect of social mobility in the early Empire. Roman aristocracy was based on competition, and unlike later European nobility , a Roman family could not maintain its position merely through hereditary succession or having title to lands. Admission to the higher ordines brought distinction and privileges, but also responsibilities. In antiquity, a city depended on its leading citizens to fund public works, events, and services ( munera ). Maintaining one's rank required massive personal expenditures. Decurions were so vital for
4495-503: Is called. He has to acquire his portion of the debt from some holder of a coin or certificate or other form of government money, and present it to the Treasury in liquidation of his legal debt. He has to redeem or cancel that portion of the debt...The redemption of government debt by taxation is the basic law of coinage and of any issue of government ‘money’ in whatever form. Knapp and "Chartalism" were referenced by John Maynard Keynes in
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4640-468: Is implemented through automatic stabilizers without any active decisions by politicians. Automatic stabilizers do not suffer from the policy lags of discretionary fiscal policy . Automatic stabilizers use conventional fiscal mechanisms, but take effect as soon as the economy takes a downturn: spending on unemployment benefits automatically increases when unemployment rises, and tax revenues decrease, which shelters private income and consumption from part of
4785-409: Is measured by the unemployment rate, i.e. the percentage of persons in the labor force who do not have a job, but who are actively looking for one. People who are retired, pursuing education, or discouraged from seeking work by a lack of job prospects are not part of the labor force and consequently not counted as unemployed, either. Unemployment has a short-run cyclical component which depends on
4930-416: Is referred to as an "environment's source function", and this function is depleted as resources are consumed or pollution contaminates the resources. The "sink function" describes an environment's ability to absorb and render harmless waste and pollution: when waste output exceeds the limit of the sink function, long-term damage occurs. The division into various time frames of macroeconomic research leads to
5075-464: Is that of an economy's openness, economic theory distinguishing sharply between closed economies and open economies . It is usual to distinguish between three time horizons in macroeconomics, each having its own focus on e.g. the determination of output: National output is the total amount of everything a country produces in a given period of time. Everything that is produced and sold generates an equal amount of income. The total net output of
5220-470: Is the product of two inputs: capital and labor. The Solow model assumes that labor and capital are used at constant rates without the fluctuations in unemployment and capital utilization commonly seen in business cycles. In this model, increases in output, i.e. economic growth, can only occur because of an increase in the capital stock, a larger population, or technological advancements that lead to higher productivity ( total factor productivity ). An increase in
5365-619: Is traditionally regarded as the Pax Romana ("Roman Peace"). The cohesion of the empire was furthered by a degree of social stability and economic prosperity that Rome had never before experienced. Uprisings in the provinces were infrequent and put down "mercilessly and swiftly". The success of Augustus in establishing principles of dynastic succession was limited by his outliving a number of talented potential heirs. The Julio-Claudian dynasty lasted for four more emperors— Tiberius , Caligula , Claudius , and Nero —before it yielded in 69 AD to
5510-604: The Battle of Actium in 31 BC. In 27 BC the Senate gave him the title Augustus ("venerated") and made him princeps ("foremost") with proconsular imperium , thus beginning the Principate , the first epoch of Roman imperial history. Although the republic stood in name, Augustus had all meaningful authority. During his 40-year rule, a new constitutional order emerged so that, upon his death, Tiberius would succeed him as
5655-475: The Dominate . The emperor was the ultimate authority in policy- and decision-making, but in the early Principate, he was expected to be accessible and deal personally with official business and petitions. A bureaucracy formed around him only gradually. The Julio-Claudian emperors relied on an informal body of advisors that included not only senators and equestrians, but trusted slaves and freedmen. After Nero,
5800-608: The Federal Reserve and the European Central Bank , which are generally considered to follow a strategy very close to inflation targeting, even though they do not officially label themselves as inflation targeters. In practice, an official inflation targeting often leaves room for the central bank to also help stabilize output and employment, a strategy known as "flexible inflation targeting". Most emerging economies focus their monetary policy on maintaining
5945-694: The Huns of Attila , led to the decline of the Western Roman Empire . With the fall of Ravenna to the Germanic Herulians and the deposition of Romulus Augustus in 476 by Odoacer , the Western Empire finally collapsed. The Eastern Roman Empire survived for another millennium with Constantinople as its sole capital, until the city's fall in 1453. Due to the Empire's extent and endurance, its institutions and culture had
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6090-552: The Italian Renaissance . Rome's architectural tradition served as the basis for Romanesque , Renaissance and Neoclassical architecture , influencing Islamic architecture . The rediscovery of classical science and technology (which formed the basis for Islamic science ) in medieval Europe contributed to the Scientific Renaissance and Scientific Revolution . Many modern legal systems, such as
6235-718: The Napoleonic Code , descend from Roman law. Rome's republican institutions have influenced the Italian city-state republics of the medieval period, the early United States , and modern democratic republics . Rome had begun expanding shortly after the founding of the Roman Republic in the 6th century BC, though not outside the Italian Peninsula until the 3rd century BC. Thus, it was an "empire" (a great power) long before it had an emperor. The Republic
6380-586: The Nile Valley in Egypt. The empire completely circled the Mediterranean ... referred to by its conquerors as mare nostrum —'our sea'. Trajan's successor Hadrian adopted a policy of maintaining rather than expanding the empire. Borders ( fines ) were marked, and the frontiers ( limites ) patrolled. The most heavily fortified borders were the most unstable. Hadrian's Wall , which separated
6525-478: The Roman Senate granted Octavian overarching military power ( imperium ) and the new title of Augustus , marking his accession as the first Roman emperor . The vast Roman territories were organized into senatorial provinces, governed by proconsuls who were appointed by lot annually, and imperial provinces, which belonged to the emperor but were governed by legates . The first two centuries of
6670-596: The Servile Wars of the Republic, legislation under Augustus and his successors shows a driving concern for controlling the threat of rebellions through limiting the size of work groups, and for hunting down fugitive slaves. Over time slaves gained increased legal protection, including the right to file complaints against their masters. A bill of sale might contain a clause stipulating that the slave could not be employed for prostitution, as prostitutes in ancient Rome were often slaves. The burgeoning trade in eunuchs in
6815-507: The eastern empire lasted until the fall of Constantinople in 1453. By 100 BC, Rome had expanded its rule to most of the Mediterranean and beyond. However, it was severely destabilised by civil wars and political conflicts , which culminated in the victory of Octavian over Mark Antony and Cleopatra at the Battle of Actium in 31 BC, and the subsequent conquest of the Ptolemaic Kingdom in Egypt. In 27 BC,
6960-475: The multiplier effect would magnify a small decrease in consumption or investment and cause declines throughout the economy, and noted the role that uncertainty and animal spirits can play in the economy. The generation following Keynes combined the macroeconomics of the General Theory with neoclassical microeconomics to create the neoclassical synthesis . By the 1950s, most economists had accepted
7105-411: The 1940s attempted to build a long-run growth model inspired by Keynesian demand-driven considerations. The Solow–Swan model worked out by Robert Solow and, independently, Trevor Swan in the 1950s achieved more long-lasting success, however, and is still today a common textbook model for explaining economic growth in the long-run. The model operates with a production function where national output
7250-621: The 600-member body by appointment. A senator's son belonged to the ordo senatorius , but he had to qualify on his own merits for admission to the Senate. A senator could be removed for violating moral standards. In the time of Nero, senators were still primarily from Italy , with some from the Iberian peninsula and southern France; men from the Greek-speaking provinces of the East began to be added under Vespasian. The first senator from
7395-400: The 6th and 7th centuries with the disintegration of the complex Imperial economy. Laws pertaining to slavery were "extremely intricate". Slaves were considered property and had no legal personhood . They could be subjected to forms of corporal punishment not normally exercised on citizens, sexual exploitation , torture, and summary execution . A slave could not as a matter of law be raped;
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#17327728661797540-457: The Augustan programme to restore traditional morality and social order, moral legislation attempted to regulate conduct as a means of promoting " family values ". Adultery was criminalized, and defined broadly as an illicit sex act ( stuprum ) between a male citizen and a married woman, or between a married woman and any man other than her husband. That is, a double standard was in place:
7685-843: The Centre of Full Employment and Equity or CofFEE at the University of Newcastle in Australia, coined the term Modern Monetary Theory to describe modern Neo-Chartalism, and that term is now widely used. Scott Fullwiler has added detailed technical analysis of the banking and monetary systems. Rodger Malcolm Mitchell's book Free Money describes in layman's terms the essence of chartalism. Some contemporary proponents, such as Wray, situate chartalism within post-Keynesian economics , while chartalism has been proposed as an alternative or complementary theory to monetary circuit theory , both being forms of endogenous money , i.e., money created within
7830-577: The Empire saw a period of unprecedented stability and prosperity known as the Pax Romana ( lit. ' Roman Peace ' ). Rome reached its greatest territorial extent under Trajan ( r. 98–117 AD ), but a period of increasing trouble and decline began under Commodus ( r. 180–192 ). In the 3rd century, the Empire underwent a 49-year crisis that threatened its existence due to civil war, plagues and barbarian invasions . The Gallic and Palmyrene empires broke away from
7975-524: The Empire was engulfed by the Crisis of the Third Century , a period of invasions , civil strife , economic disorder , and plague . In defining historical epochs , this crisis sometimes marks the transition from Classical to Late Antiquity . Aurelian ( r. 270–275 ) stabilised the empire militarily and Diocletian reorganised and restored much of it in 285. Diocletian's reign brought
8120-499: The Great Depression struck, the reigning economists had difficulty explaining how goods could go unsold and workers could be left unemployed. In the prevailing neoclassical economics paradigm, prices and wages would drop until the market cleared, and all goods and labor were sold. Keynes in his main work, the General Theory , initiated what is known as the Keynesian revolution . He offered a new interpretation of events and
8265-475: The Keynesian school. A central development in new classical thought came when Robert Lucas introduced rational expectations to macroeconomics. Prior to Lucas, economists had generally used adaptive expectations where agents were assumed to look at the recent past to make expectations about the future. Under rational expectations, agents are assumed to be more sophisticated. Consumers will not simply assume
8410-1173: The Lucas critique. Like classical models, new classical models had assumed that prices would be able to adjust perfectly and monetary policy would only lead to price changes. New Keynesian models investigated sources of sticky prices and wages due to imperfect competition , which would not adjust, allowing monetary policy to impact quantities instead of prices. Stanley Fischer and John B. Taylor produced early work in this area by showing that monetary policy could be effective even in models with rational expectations when contracts locked in wages for workers. Other new Keynesian economists, including Olivier Blanchard , Janet Yellen , Julio Rotemberg , Greg Mankiw , David Romer , and Michael Woodford , expanded on this work and demonstrated other cases where various market imperfections caused inflexible prices and wages leading in turn to monetary and fiscal policy having real effects. Other researchers focused on imperferctions in labor markets, developing models of efficiency wages or search and matching (SAM) models, or imperfections in credit markets like Ben Bernanke . By
8555-612: The Middle East. The Latin phrase imperium sine fine ("empire without end" ) expressed the ideology that neither time nor space limited the Empire. In Virgil 's Aeneid , limitless empire is said to be granted to the Romans by Jupiter . This claim of universal dominion was renewed when the Empire came under Christian rule in the 4th century. In addition to annexing large regions, the Romans directly altered their geography, for example cutting down entire forests . Roman expansion
8700-454: The Rhine and Danube. Roman jurists also show a concern for local languages such as Punic , Gaulish , and Aramaic in assuring the correct understanding of laws and oaths. In Africa , Libyco-Berber and Punic were used in inscriptions into the 2nd century. In Syria , Palmyrene soldiers used their dialect of Aramaic for inscriptions, an exception to the rule that Latin was the language of
8845-617: The Roman Republic ) while greatly extending its power beyond Italy. In 44 BC Julius Caesar was briefly perpetual dictator before being assassinated by a faction that opposed his concentration of power. This faction was driven from Rome and defeated at the Battle of Philippi in 42 BC by Mark Antony and Caesar's adopted son Octavian . Antony and Octavian divided the Roman world between them, but this did not last long. Octavian's forces defeated those of Mark Antony and Cleopatra at
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#17327728661798990-430: The Roman legal concept of imperium , meaning "command" (typically in a military sense). Occasionally, successful consuls or generals were given the honorary title imperator (commander); this is the origin of the word emperor , since this title was always bestowed to the early emperors. Rome suffered a long series of internal conflicts, conspiracies, and civil wars from the late second century BC (see Crisis of
9135-448: The Roman world from what was perceived as an ever-present barbarian threat, is the primary surviving monument of this effort. Latin and Greek were the main languages of the Empire, but the Empire was deliberately multilingual. Andrew Wallace-Hadrill says "The main desire of the Roman government was to make itself understood". At the start of the Empire, knowledge of Greek was useful to pass as educated nobility and knowledge of Latin
9280-449: The account of his achievements ( Res Gestae ) prominently featured the geographical cataloguing of the Empire. Geography alongside meticulous written records were central concerns of Roman Imperial administration . The Empire reached its largest expanse under Trajan ( r. 98–117 ), encompassing 5 million km . The traditional population estimate of 55–60 million inhabitants accounted for between one-sixth and one-fourth of
9425-447: The business cycle, and a more permanent structural component, which can be loosely thought of as the average unemployment rate in an economy over extended periods, and which is often termed the natural or structural rate of unemployment. Cyclical unemployment occurs when growth stagnates. Okun's law represents the empirical relationship between unemployment and short-run GDP growth. The original version of Okun's law states that
9570-459: The case of a very low interest level, the economy may be in a liquidity trap in which monetary policy becomes ineffective, which makes fiscal policy the more potent tool to stabilize the economy. Thirdly, in regimes where monetary policy is tied to fulfilling other targets, in particular fixed exchange rate regimes, the central bank cannot simultaneously adjust its interest rates to mitigate domestic business cycle fluctuations, making fiscal policy
9715-418: The collapse of the Empire's west. The dominance of Latin and Greek among the literate elite obscure the continuity of other spoken languages within the Empire. Latin, referred to in its spoken form as Vulgar Latin , gradually replaced Celtic and Italic languages . References to interpreters indicate the continuing use of local languages, particularly in Egypt with Coptic , and in military settings along
9860-482: The conditions of martyrdom . The three major elements of the Imperial state were the central government, the military, and the provincial government. The military established control of a territory through war, but after a city or people was brought under treaty, the mission turned to policing: protecting Roman citizens, agricultural fields, and religious sites. The Romans lacked sufficient manpower or resources to rule through force alone. Cooperation with local elites
10005-409: The consequences of international trade in goods , financial assets and possibly factor markets like labor migration and international relocation of firms (physical capital). It explores what determines import , export , the balance of trade and over longer horizons the accumulation of net foreign assets . An important topic is the role of exchange rates and the pros and cons of maintaining
10150-548: The currency they issue. Georg Friedrich Knapp , a German economist , invented the term "chartalism" in his State Theory of Money , which was published in German in 1905 and translated into English in 1924. The name derives from the Latin charta , in the sense of a token or ticket. Knapp argued that "money is a creature of law" rather than a commodity . Knapp contrasted his state theory of money with " metallism ", as embodied at
10295-481: The deceased emperor's deification. The dominance of the emperor was based on the consolidation of powers from several republican offices. The emperor made himself the central religious authority as pontifex maximus , and centralized the right to declare war, ratify treaties, and negotiate with foreign leaders. While these functions were clearly defined during the Principate , the emperor's powers over time became less constitutional and more monarchical, culminating in
10440-501: The descent "from a kingdom of gold to one of rust and iron", a comment which has led some historians, notably Edward Gibbon , to take Commodus' reign as the beginning of the Empire's decline . In 212, during the reign of Caracalla , Roman citizenship was granted to all freeborn inhabitants of the empire. The Severan dynasty was tumultuous; an emperor's reign was ended routinely by his murder or execution and, following its collapse,
10585-404: The development of the macroeconomic research mainstream . Macroeconomics encompasses a variety of concepts and variables, but above all the three central macroeconomic variables are output, unemployment, and inflation. Besides, the time horizon varies for different types of macroeconomic topics, and this distinction is crucial for many research and policy debates. A further important dimension
10730-678: The difference may be considerable. Economists interested in long-run increases in output study economic growth. Advances in technology, accumulation of machinery and other capital , and better education and human capital , are all factors that lead to increased economic output over time. However, output does not always increase consistently over time. Business cycles can cause short-term drops in output called recessions . Economists look for macroeconomic policies that prevent economies from slipping into either recessions or overheating and that lead to higher productivity levels and standards of living . The amount of unemployment in an economy
10875-767: The differences between bank money and state money. James K. Galbraith supports chartalism and wrote the foreword for Mosler's book Seven Deadly Innocent Frauds of Economic Policy in 2010. Macroeconomics Heterodox Macroeconomics is a branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole. This includes regional, national, and global economies . Macroeconomists study topics such as output / GDP (gross domestic product) and national income , unemployment (including unemployment rates ), price indices and inflation , consumption , saving , investment , energy , international trade , and international finance . Macroeconomics and microeconomics are
11020-472: The easternmost province, Cappadocia , was admitted under Marcus Aurelius. By the Severan dynasty (193–235), Italians made up less than half the Senate. During the 3rd century, domicile at Rome became impractical, and inscriptions attest to senators who were active in politics and munificence in their homeland ( patria ). Senators were the traditional governing class who rose through the cursus honorum ,
11165-440: The economic system is dependant upon the environment. In this case, the circular flow of income diagram may be replaced by a more complex flow diagram reflecting the input of solar energy, which sustains natural inputs and environmental services which are then used as units of production . Once consumed, natural inputs pass out of the economy as pollution and waste. The potential of an environment to provide services and materials
11310-529: The economy , i.e. limiting the effects of the business cycle by conducting expansive policy when the economy is in a recession or contractive policy in the case of overheating . Structural policies may be labor market policies which aim to change the structural unemployment rate or policies which affect long-run propensities to save, invest, or engage in education or research and development. Central banks conduct monetary policy mainly by adjusting short-term interest rates . The actual method through which
11455-454: The economy is usually measured as gross domestic product (GDP). Adding net factor incomes from abroad to GDP produces gross national income (GNI), which measures total income of all residents in the economy. In most countries, the difference between GDP and GNI are modest so that GDP can approximately be treated as total income of all the inhabitants as well, but in some countries, e.g. countries with very large net foreign assets (or debt),
11600-502: The economy was sufficient to explain the Great Depression , and that aggregate demand oriented explanations were not necessary. Friedman also argued that monetary policy was more effective than fiscal policy; however, Friedman doubted the government's ability to "fine-tune" the economy with monetary policy. He generally favored a policy of steady growth in money supply instead of frequent intervention. Friedman also challenged
11745-503: The economy, as by government deficit spending or bank lending, rather than from outside, as by gold. In the complementary view, chartalism explains the "vertical" (government-to-private and vice versa) interactions, while circuit theory is a model of the "horizontal" (private-to-private) interactions. Hyman Minsky seemed to incorporate a Chartalist approach to money creation in his Stabilizing an Unstable Economy , while Basil Moore , in his book Horizontalists and Verticalists , delineates
11890-463: The economy, could hardly generate the large short-run output fluctuations that we observe. In addition, there is strong empirical evidence that monetary policy does affect real economic activity, and the idea that technological regress can explain recent recessions seems implausible. Despite criticism of the realism in the RBC models, they have been very influential in economic methodology by providing
12035-514: The empire's most concerted effort against the perceived threat of Christianity , the " Great Persecution ". Diocletian divided the empire into four regions, each ruled by a separate tetrarch . Confident that he fixed the disorder plaguing Rome, he abdicated along with his co-emperor, but the Tetrarchy collapsed shortly after . Order was eventually restored by Constantine the Great , who became
12180-506: The empire. This legal egalitarianism required a far-reaching revision of existing laws that distinguished between citizens and non-citizens. Freeborn Roman women were considered citizens, but did not vote, hold political office, or serve in the military. A mother's citizen status determined that of her children, as indicated by the phrase ex duobus civibus Romanis natos ("children born of two Roman citizens"). A Roman woman kept her own family name ( nomen ) for life. Children most often took
12325-631: The end of the Western Roman Empire in 476, when Romulus Augustulus was forced to abdicate to the Germanic warlord Odoacer . Odoacer ended the Western Empire by declaring Zeno sole emperor and placing himself as Zeno's nominal subordinate. In reality, Italy was ruled by Odoacer alone. The Eastern Roman Empire, called the Byzantine Empire by later historians, continued until the reign of Constantine XI Palaiologos ,
12470-601: The entire economy is called inflation . When prices decrease, there is deflation . Economists measure these changes in prices with price indexes . Inflation will increase when an economy becomes overheated and grows too quickly. Similarly, a declining economy can lead to decreasing inflation and even in some cases deflation. Central bankers conducting monetary policy usually have as a main priority to avoid too high inflation, typically by adjusting interest rates. High inflation as well as deflation can lead to increased uncertainty and other negative consequences, in particular when
12615-466: The exogenous technological improvement used to explain growth in Solow's model. Another type of endogenous growth models endogenized the process of technological progress by modelling research and development activities by profit-maximizing firms explicitly within the growth models themselves. Since the 1970s, various environmental problems have been integrated into growth and other macroeconomic models to study their implications more thoroughly. During
12760-504: The exploitation of slaves. Outside Italy, slaves were on average an estimated 10 to 20% of the population, sparse in Roman Egypt but more concentrated in some Greek areas. Expanding Roman ownership of arable land and industries affected preexisting practices of slavery in the provinces. Although slavery has often been regarded as waning in the 3rd and 4th centuries, it remained an integral part of Roman society until gradually ceasing in
12905-405: The fall in market income. There is a general consensus that both monetary and fiscal instruments may affect demand and activity in the short run (i.e. over the business cycle). Economists usually favor monetary over fiscal policy to mitigate moderate fluctuations, however, because it has two major advantages. First, monetary policy is generally implemented by independent central banks instead of
13050-457: The father's name, with some exceptions. Women could own property, enter contracts, and engage in business. Inscriptions throughout the Empire honour women as benefactors in funding public works, an indication they could hold considerable fortunes. The archaic manus marriage in which the woman was subject to her husband's authority was largely abandoned by the Imperial era, and a married woman retained ownership of any property she brought into
13195-640: The first emperor to convert to Christianity , and who established Constantinople as the new capital of the Eastern Empire. During the decades of the Constantinian and Valentinian dynasties, the empire was divided along an east–west axis, with dual power centres in Constantinople and Rome. Julian , who under the influence of his adviser Mardonius attempted to restore Classical Roman and Hellenistic religion , only briefly interrupted
13340-478: The first examples of general equilibrium models based on microeconomic foundations and a specification of underlying shocks that aim to explain the main features of macroeconomic fluctuations, not only qualitatively, but also quantitatively. In this way, they were forerunners of the later DSGE models. New Keynesian economists responded to the new classical school by adopting rational expectations and focusing on developing micro-founded models that were immune to
13485-456: The functioning of cities that in the later Empire, as the ranks of the town councils became depleted, those who had risen to the Senate were encouraged to return to their hometowns, in an effort to sustain civic life. In the later Empire, the dignitas ("worth, esteem") that attended on senatorial or equestrian rank was refined further with titles such as vir illustris ("illustrious man"). The appellation clarissimus (Greek lamprotatos )
13630-429: The government takes on spending projects, it limits the amount of resources available for the private sector to use. Full crowding out occurs in the extreme case when government spending simply replaces private sector output instead of adding additional output to the economy. A crowding out effect may also occur if government spending should lead to higher interest rates, which would limit investment. Some fiscal policy
13775-692: The historian Christopher Kelly described it: Then the empire stretched from Hadrian's Wall in drizzle-soaked northern England to the sun-baked banks of the Euphrates in Syria; from the great Rhine – Danube river system, which snaked across the fertile, flat lands of Europe from the Low Countries to the Black Sea , to the rich plains of the North African coast and the luxuriant gash of
13920-498: The inflation (or deflation) is unexpected. Consequently, most central banks aim for a positive, but stable and not very high inflation level. Changes in the inflation level may be the result of several factors. Too much aggregate demand in the economy will cause an overheating , raising inflation rates via the Phillips curve because of a tight labor market leading to large wage increases which will be transmitted to increases in
14065-538: The interest rate is changed differs from central bank to central bank, but typically the implementation happens either directly via administratively changing the central bank's own offered interest rates or indirectly via open market operations . Via the monetary transmission mechanism , interest rate changes affect investment , consumption , asset prices like stock prices and house prices , and through exchange rate reactions export and import . In this way aggregate demand , employment and ultimately inflation
14210-521: The last Roman emperor. He died in battle in 1453 against Mehmed II and his Ottoman forces during the siege of Constantinople . Mehmed II adopted the title of caesar in an attempt to claim a connection to the former Empire. His claim was soon recognized by the Patriarchate of Constantinople , but not by most European monarchs. The Roman Empire was one of the largest in history, with contiguous territories throughout Europe, North Africa, and
14355-466: The late 1990s, economists had reached a rough consensus. The market imperfections and nominal rigidities of new Keynesian theory was combined with rational expectations and the RBC methodology to produce a new and popular type of models called dynamic stochastic general equilibrium (DSGE) models. The fusion of elements from different schools of thought has been dubbed the new neoclassical synthesis . These models are now used by many central banks and are
14500-592: The late 1st century prompted legislation that prohibited the castration of a slave against his will "for lust or gain". Roman slavery was not based on race . Generally, slaves in Italy were indigenous Italians, with a minority of foreigners (including both slaves and freedmen) estimated at 5% of the total in the capital at its peak, where their number was largest. Foreign slaves had higher mortality and lower birth rates than natives, and were sometimes even subjected to mass expulsions. The average recorded age at death for
14645-417: The macro economy. RBC models were created by combining fundamental equations from neo-classical microeconomics to make quantitative models. In order to generate macroeconomic fluctuations, RBC models explained recessions and unemployment with changes in technology instead of changes in the markets for goods or money. Critics of RBC models argue that technological changes, which typically diffuse slowly throughout
14790-434: The macro/micro divide is institutionalized in the field of economics. Most economists identify as either macro- or micro-economists. Macroeconomics is traditionally divided into topics along different time frames: the analysis of short-term fluctuations over the business cycle , the determination of structural levels of variables like inflation and unemployment in the medium (i.e. unaffected by short-term deviations) term, and
14935-486: The marriage. Technically she remained under her father's legal authority, even though she moved into her husband's home, but when her father died she became legally emancipated. This arrangement was a factor in the degree of independence Roman women enjoyed compared to many other cultures up to the modern period: although she had to answer to her father in legal matters, she was free of his direct scrutiny in daily life, and her husband had no legal power over her. Although it
15080-416: The members of the three higher "orders", along with certain military officers. The granting of universal citizenship in 212 seems to have increased the competitive urge among the upper classes to have their superiority affirmed, particularly within the justice system. Sentencing depended on the judgment of the presiding official as to the relative "worth" ( dignitas ) of the defendant: an honestior could pay
15225-730: The military. The last reference to Gaulish was between 560 and 575. The emergent Gallo-Romance languages would then be shaped by Gaulish. Proto-Basque or Aquitanian evolved with Latin loan words to modern Basque . The Thracian language , as were several now-extinct languages in Anatolia, are attested in Imperial-era inscriptions. The Empire was remarkably multicultural, with "astonishing cohesive capacity" to create shared identity while encompassing diverse peoples. Public monuments and communal spaces open to all—such as forums , amphitheatres , racetracks and baths —helped foster
15370-593: The money market is modeled as giving equilibrium between the money supply and liquidity preference (equivalent to money demand). Roman Empire The Roman Empire was the era of Roman civilisation lasting from 27 BC to 476 AD. Rome ruled the Mediterranean and much of Europe, Western Asia and North Africa. The Romans conquered most of this during the Republic , and it was ruled by emperors following Octavian 's assumption of effective sole rule in 27 BC. The western empire collapsed in 476 AD, but
15515-444: The new de facto monarch. As Roman provinces were being established throughout the Mediterranean, Italy maintained a special status which made it domina provinciarum ("ruler of the provinces"), and – especially in relation to the first centuries of imperial stability – rectrix mundi ("governor of the world") and omnium terrarum parens ("parent of all lands"). The 200 years that began with Augustus's rule
15660-420: The new classical real business cycle models , microfounded computable general equilibrium (CGE) models used for medium-term (structural) questions like international trade or tax reforms, Dynamic stochastic general equilibrium (DSGE) models used to analyze business cycles, not least in many central banks, or integrated assessment models like DICE . The IS–LM model, invented by John Hicks in 1936, gives
15805-564: The oil crises of the 1970s when scarcity problems of natural resources were high on the public agenda, economists like Joseph Stiglitz and Robert Solow introduced non-renewable resources into neoclassical growth models to study the possibilities of maintaining growth in living standards under these conditions. More recently, the issue of climate change and the possibilities of a sustainable development are examined in so-called integrated assessment models , pioneered by William Nordhaus . In macroeconomic models in environmental economics ,
15950-606: The only usable tool for such countries. Macroeconomic teaching, research and informed debates normally evolve around formal ( diagrammatic or equational ) macroeconomic models to clarify assumptions and show their consequences in a precise way. Models include simple theoretical models, often containing only a few equations, used in teaching and research to highlight key basic principles, and larger applied quantitative models used by e.g. governments, central banks, think tanks and international organisations to predict effects of changes in economic policy or other exogenous factors or as
16095-451: The opening pages of his 1930 Treatise on Money and appear to have influenced Keynesian ideas on the role of the state in the economy. By 1947, when Abba Lerner wrote his article "Money as a Creature of the State", economists had largely abandoned the idea that the value of money was closely linked to gold. Lerner argued that responsibility for avoiding inflation and depressions lay with
16240-480: The original simple Phillips curve relationship between inflation and unemployment. Friedman and Edmund Phelps (who was not a monetarist) proposed an "augmented" version of the Phillips curve that excluded the possibility of a stable, long-run tradeoff between inflation and unemployment. When the oil shocks of the 1970s created a high unemployment and high inflation, Friedman and Phelps were vindicated. Monetarism
16385-412: The political career track, but equestrians often possessed greater wealth and political power. Membership in the equestrian order was based on property; in Rome's early days, equites or knights had been distinguished by their ability to serve as mounted warriors, but cavalry service was a separate function in the Empire. A census valuation of 400,000 sesterces and three generations of free birth qualified
16530-465: The political institutions that control fiscal policy. Independent central banks are less likely to be subject to political pressures for overly expansionary policies. Second, monetary policy may suffer shorter inside lags and outside lags than fiscal policy. There are some exceptions, however: Firstly, in the case of a major shock, monetary stabilization policy may not be sufficient and should be supplemented by active fiscal stabilization. Secondly, in
16675-507: The poor were other sources. Vernae , by contrast, were "homegrown" slaves born to female slaves within the household, estate or farm. Although they had no special legal status, an owner who mistreated or failed to care for his vernae faced social disapproval, as they were considered part of the family household and in some cases might actually be the children of free males in the family. Rome differed from Greek city-states in allowing freed slaves to become citizens; any future children of
16820-449: The price level are directly caused by changes in the money supply . Whereas there is empirical evidence that there is a long-run positive correlation between the growth rate of the money stock and the rate of inflation, the quantity theory has proved unreliable in the short- and medium-run time horizon relevant to monetary policy and is abandoned as a practical guideline by most central banks today. Open economy macroeconomics deals with
16965-518: The price of the products of employers. Too little aggregate demand will have the opposite effect of creating more unemployment and lower wages, thereby decreasing inflation. Aggregate supply shocks will also affect inflation, e.g. the oil crises of the 1970s and the 2021–2023 global energy crisis . Changes in inflation may also impact the formation of inflation expectations , creating a self-fulfilling inflationary or deflationary spiral. The monetarist quantity theory of money holds that changes in
17110-416: The same predictions even as the underlying model generating the data changed. He advocated models based on fundamental economic theory (i.e. having an explicit microeconomic foundation ) that would, in principle, be structurally accurate as economies changed. Following Lucas's critique, new classical economists, led by Edward C. Prescott and Finn E. Kydland , created real business cycle (RBC) models of
17255-494: The savings rate leads to a temporary increase as the economy creates more capital, which adds to output. However, eventually the depreciation rate will limit the expansion of capital: savings will be used up replacing depreciated capital, and no savings will remain to pay for an additional expansion in capital. Solow's model suggests that economic growth in terms of output per capita depends solely on technological advances that enhance productivity. The Solow model can be interpreted as
17400-528: The slaves of the city of Rome was seventeen and a half years (17.2 for males; 17.9 for females). During the period of republican expansionism when slavery had become pervasive, war captives were a main source of slaves. The range of ethnicities among slaves to some extent reflected that of the armies Rome defeated in war, and the conquest of Greece brought a number of highly skilled and educated slaves. Slaves were also traded in markets and sometimes sold by pirates . Infant abandonment and self-enslavement among
17545-646: The state and a series of short-lived emperors led the Empire, which was later reunified under Aurelian ( r. 270–275 ). The civil wars ended with the victory of Diocletian ( r. 284–305 ), who set up two different imperial courts in the Greek East and Latin West . Constantine the Great ( r. 306–337 ), the first Christian emperor , moved the imperial seat from Rome to Byzantium in 330, and renamed it Constantinople . The Migration Period , involving large invasions by Germanic peoples and by
17690-625: The state because of its ability to create or tax away money. Historian Constantina Katsari sees principles from both metallism and chartalism reflected in the monetary system introduced by Augustus to the eastern provinces of the Roman Empire , from the early 1st century to the late 3rd century AD. Economists Warren Mosler , L. Randall Wray , Stephanie Kelton , and Bill Mitchell are largely responsible for reviving chartalism as an explanation of money creation ; Wray refers to this revived formulation as Neo-Chartalism . Mitchell, founder of
17835-529: The strife-torn Year of the Four Emperors , from which Vespasian emerged as the victor. Vespasian became the founder of the brief Flavian dynasty , followed by the Nerva–Antonine dynasty which produced the " Five Good Emperors ": Nerva , Trajan , Hadrian , Antoninus Pius , and Marcus Aurelius . In the view of contemporary Greek historian Cassius Dio , the accession of Commodus in 180 marked
17980-749: The study of long-term economic growth. It also studies the consequences of policies targeted at mitigating fluctuations like fiscal or monetary policy , using taxation and government expenditure or interest rates, respectively, and of policies that can affect living standards in the long term, e.g. by affecting growth rates. Macroeconomics as a separate field of research and study is generally recognized to start in 1936, when John Maynard Keynes published his The General Theory of Employment, Interest and Money , but its intellectual predecessors are much older. Since World War II, various macroeconomic schools of thought like Keynesians , monetarists , new classical and new Keynesian economists have made contributions to
18125-461: The succession of Christian emperors. Theodosius I , the last emperor to rule over both East and West, died in 395 after making Christianity the state religion . The Western Roman Empire began to disintegrate in the early 5th century. The Romans fought off all invaders, most famously Attila , but the empire had assimilated so many Germanic peoples of dubious loyalty to Rome that the empire started to dismember itself. Most chronologies place
18270-414: The synthesis view of the macroeconomy. Economists like Paul Samuelson , Franco Modigliani , James Tobin , and Robert Solow developed formal Keynesian models and contributed formal theories of consumption, investment, and money demand that fleshed out the Keynesian framework. Milton Friedman updated the quantity theory of money to include a role for money demand. He argued that the role of money in
18415-422: The time in the gold standard , where the value of a unit of currency depended on the quantity of precious metal it contained or could be exchanged for. He argued the state could create pure paper money and make it exchangeable by recognising it as legal tender , with the criterion for the money of a state being "that which is accepted at the public pay offices". When Knapp was writing, the prevailing view of money
18560-562: The time of Nero , however, it was not unusual to find a former slave who was richer than a freeborn citizen, or an equestrian who exercised greater power than a senator. The blurring of the Republic's more rigid hierarchies led to increased social mobility , both upward and downward, to a greater extent than all other well-documented ancient societies. Women, freedmen, and slaves had opportunities to profit and exercise influence in ways previously less available to them. Social life, particularly for those whose personal resources were limited,
18705-505: The two most general fields in economics. The focus of macroeconomics is often on a country (or larger entities like the whole world) and how its markets interact to produce large-scale phenomena that economists refer to as aggregate variables. In microeconomics the focus of analysis is often a single market, such as whether changes in supply or demand are to blame for price increases in the oil and automotive sectors. From introductory classes in "principles of economics" through doctoral studies,
18850-419: The underpinnings of aggregate demand (itself discussed below). It answers the question "At any given price level, what is the quantity of goods demanded?" The graphic model shows combinations of interest rates and output that ensure equilibrium in both the goods and money markets under the model's assumptions. The goods market is modeled as giving equality between investment and public and private saving (IS), and
18995-402: The word "macroeconomics" itself in a journal title in 1946. but naturally several of the themes which are central to macroeconomic research had been discussed by thoughtful economists and other writers long before 1936. In particular, macroeconomic questions before Keynes were the topic of the two long-standing traditions of business cycle theory and monetary theory . William Stanley Jevons
19140-411: The world's total population and made it the most populous unified political entity in the West until the mid-19th century. Recent demographic studies have argued for a population peak from 70 million to more than 100 million . Each of the three largest cities in the Empire – Rome, Alexandria , and Antioch – was almost twice the size of any European city at the beginning of the 17th century. As
19285-442: Was a point of pride to be a "one-man woman" ( univira ) who had married only once, there was little stigma attached to divorce , nor to speedy remarriage after being widowed or divorced. Girls had equal inheritance rights with boys if their father died without leaving a will. A mother's right to own and dispose of property, including setting the terms of her will, gave her enormous influence over her sons into adulthood. As part of
19430-475: Was further defined by their citizenship. Most citizens held limited rights (such as the ius Latinum , "Latin right"), but were entitled to legal protections and privileges not enjoyed by non-citizens. Free people not considered citizens, but living within the Roman world, were peregrini , non-Romans. In 212, the Constitutio Antoniniana extended citizenship to all freeborn inhabitants of
19575-466: Was further fostered by a proliferation of voluntary associations and confraternities ( collegia and sodalitates ): professional and trade guilds, veterans' groups, religious sodalities, drinking and dining clubs, performing troupes, and burial societies . According to the jurist Gaius , the essential distinction in the Roman " law of persons " was that all humans were either free ( liberi ) or slaves ( servi ). The legal status of free persons
19720-548: Was mostly accomplished under the Republic , though parts of northern Europe were conquered in the 1st century, when Roman control in Europe, Africa, and Asia was strengthened. Under Augustus , a "global map of the known world" was displayed for the first time in public at Rome, coinciding with the creation of the most comprehensive political geography that survives from antiquity, the Geography of Strabo . When Augustus died,
19865-671: Was necessary to maintain order, collect information, and extract revenue. The Romans often exploited internal political divisions. Communities with demonstrated loyalty to Rome retained their own laws, could collect their own taxes locally, and in exceptional cases were exempt from Roman taxation. Legal privileges and relative independence incentivized compliance. Roman government was thus limited , but efficient in its use of available resources. The Imperial cult of ancient Rome identified emperors and some members of their families with divinely sanctioned authority ( auctoritas ). The rite of apotheosis (also called consecratio ) signified
20010-416: Was never a legal requirement for Latin in the Empire, but it represented a certain status. High standards of Latin, Latinitas , started with the advent of Latin literature. Due to the flexible language policy of the Empire, a natural competition of language emerged that spurred Latinitas , to defend Latin against the stronger cultural influence of Greek. Over time Latin usage was used to project power and
20155-445: Was not a nation-state in the modern sense, but a network of self-ruled towns (with varying degrees of independence from the Senate ) and provinces administered by military commanders. It was governed by annually elected magistrates ( Roman consuls above all) in conjunction with the Senate. The 1st century BC was a time of political and military upheaval, which ultimately led to rule by emperors. The consuls' military power rested in
20300-426: Was not itself an elected office in ancient Rome; an individual gained admission to the Senate after he had been elected to and served at least one term as an executive magistrate . A senator also had to meet a minimum property requirement of 1 million sestertii . Not all men who qualified for the ordo senatorius chose to take a Senate seat, which required legal domicile at Rome. Emperors often filled vacancies in
20445-468: Was one of the pioneers of the first tradition, whereas the quantity theory of money , labelled the oldest surviving theory in economics, as an example of the second was described already in the 16th century by Martín de Azpilcueta and later discussed by personalities like John Locke and David Hume . In the first decades of the 20th century monetary theory was dominated by the eminent economists Alfred Marshall , Knut Wicksell and Irving Fisher . When
20590-416: Was particularly influential in the early 1980s, but fell out of favor when central banks found the results disappointing when trying to target money supply instead of interest rates as monetarists recommended, concluding that the relationships between money growth, inflation and real GDP growth are too unstable to be useful in practical monetary policy making. New classical macroeconomics further challenged
20735-533: Was that it had evolved from systems of barter to become a medium of exchange because it represented a durable commodity which had some use value . However, as modern chartalist economists such as Randall Wray and Mathew Forstater have pointed out, chartalist insights into tax-driven paper money can be found in the earlier writings of many classical economists, for instance Adam Smith , who observed in The Wealth of Nations : A prince, who should enact that
20880-447: Was used to designate the dignitas of certain senators and their immediate family, including women. "Grades" of equestrian status proliferated. As the republican principle of citizens' equality under the law faded, the symbolic and social privileges of the upper classes led to an informal division of Roman society into those who had acquired greater honours ( honestiores ) and humbler folk ( humiliores ). In general, honestiores were
21025-476: Was useful for a career in the military, government, or law. Bilingual inscriptions indicate the everyday interpenetration of the two languages. Latin and Greek's mutual linguistic and cultural influence is a complex topic. Latin words incorporated into Greek were very common by the early imperial era, especially for military, administration, and trade and commerce matters. Greek grammar, literature, poetry and philosophy shaped Latin language and culture. There
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