September 12, 2017

 Trade is an aspect of business which we can run back to the bronze age even though we
don’t have any written records. Bronze is an ali of copper and tin
o Mediterranean does not have tin and to have so much bronze you have to get tin
from somewhere else
 Some think the tin came from Cornwall in England but this is unlikely
because their ships most likely could not make it from England to the
Mediterranean
 Most likely story is that the tin came from Afghanistan
 Tin had to be imported and it was not done on the initiative by Kings
somewhere but rather by individual traders. The coppersmiths on Cyprus
could create an alloy that we call bronze. The price of bronze cam down
dramatically from the early bronze age to the late bronze age
 The amount of silver did not change but the price of bronze in terms of
silver, the price of bronze must have come down if the quantity of bronze
increased which means that imports increased
 Tools, swords, shields, agricultural goods were made of tin
o Tin and copper were combined to produce bronze
o The Mediterranean was a nice sea for traders – it doesn’t have tides or storms to
the same extent that the Atlantic does
 The coastlines were very irregular – which means you have a lot of bays
and places that ships can anchor safely.
 Most of the prosperous places in the Mediterranean had access to these
bays
 Just by its geographic area, it was good for globalization as it conducted a
large range of trade
o Around 1300 BC, something happens. There was disruption. The Misonaion of
Greece – mainly located on places like Crete. All around the Mediterranean,
everything got disrupted and the Bronze age came to an end
 Disagreement among historians as to why the Bronze age ended and why
it transitioned into the Iron Age
 Idea that Iron was superior to Bronze and so that’s why the replacement
happened. Around the time the bronze age ended, iron was not superior to
bronze. Iron is tricky to smelt and there is not a lot of pure high quality
iron, the supply on earth is limited.
 There is really only two sources for this: Greenland, which was of
no use in the Bronze Age. The other source is meteors.
 The only iron that is available on earth that makes it easy to make
things like sword blades out of is Meteor iron because of the mix
of nickel and iron making it easy to work.
 Iliad: story of a competition among hereos and the prize was a lump of
rock that had fallen from the sky (meteor). The reason the rock was
valuable was because it contained iron.
 When King Tut died, he was buried with things that indicated he was
wealthy. They used iron to make jewellery because when you smelt it,
 unless you do it exactly right it is either very soft or very brittle. Through
most of the bronze age, they did not know how to smelt it exactly right to
make weapons so they used it almost exclusively for jewelry by using the
soft iron.
 Tut was buried with an iron blade that had meteoric origin
 Bronze was an alloy of copper and tin which needed to be imported. You are making this
allow that is good for sword blades which is a lot better than the stone age blades. The
iron isn’t really good for anything because when you try and go from the ore to
something which is approaching a purified iron, you are going to end up with something
very soft or very brittle.
 In the bronze age, iron was around but it was not superior to bronze. So why the
transition between the two ages? Most likely because they figured out how to smelt the
iron properly, iron just took off because you had all kinds of iron around so that all
peasants could have some kind of blade which was not like bronze which was mainly had
by the wealthy
 The disruption of around 1300 BC was from a trade disruption – not just temporarily but
the trade routes broke down and then tin wasn’t coming in in the previous quantity.
o People started stock piling and recycling bronze which is not a solution to a
shortage
o Only one metal that can be recycled repeatedly: aluminum
o Recycling of the bronze was a sign that there was a shortage of bronze developing
meaning the price of bronze was going up and the return of finding a substitute
for bronze was increasingly needed.
o Once the bronze is no longer available in the same quantity because the tin is not
coming in because the tin is not coming in, as a coppersmith you can see the
profit of playing around with iron
o The ciprit coppersmiths were incentivised by finding a good substitute for bronze
and iron eventually became incredibly cheap
 Resource scarcity: you gad a metal which was important to industrial activity. The import
of tin is disrupted most likely because of war in Afghanistan and it is not just disrupted
temporarily so the response is to find an alternative to bronze which is where iron comes
from. Its only when you get shortages that drive up the price of something does it become
worthwhile to find an alternative. This comes back to economists take the view that
economists are the same which means that people will respond the same in different
times and in different places
o The railway era in Britain was driven by the discovery of an improved way to
smelt iron was driven by a resource scarcity, but not by iron. It was driven in
England in the 18th century by the scarcity of wood. That happened in about 1700
AD
o Same thing happened in China about 1000 years earlier
 Iron became a substitute for bronze in about 1000 years
 Iron started becoming a viable alternative
 By about 1000 BC things started to settle down again and the Mediterranean ceased to be
a safe sea and the people who were the great traders of the iron age were the Phoenicians
who were people who lived on the coast of the Mediterranean.
 o Phoenicians gained a reputation of being slick traders and others did not like
them. People thought they were cheating because no one could possibly be that
good at trading. They built ships and developed better navigation skills. They
were the first to sail diagonally across the Mediterranean while most voyagers
hugged the coastline. They developed their sailing skills to a point where they
were willing to take that risk. Phoenicians traded from the eastern end of the
Mediterranean to Spain where they could acquire silver which was wanted by
everyone. Once you had access to the Spanish silver mines, this was the basis of a
very successful trade.
o Phoenician is a Greek term for purple. The most famous product was a purple die
which was produced by shellfish found around the Phoenician cities. Roman
Emperors were referred to as being raised to the purple because they could wear a
toga that had a lot of purple in it making it the royal colour. It was such high
quality which could only be produced by the shellfish which cannot be produced
today.
 The shellfish that were used to make the purple were fished to extinction
o They also traded in glass and pottery but the Phoenician glass was inferior to the
Egyptian glass and the pottery was inferior to the Greek pottery. They were
essentially the Walmart of the early Iron Age. They mass produced because it
wasn’t as intricate, allowing them to sell it cheaper giving poorer people access to
these goods.
 Phoenicians were making these goods available to the public
 Phoenicians were eventually displaced as the leading traders by the Greeks who became
the dominant trading people – the Athenians.
 The city state that came to dominate was the marketers of Athens. If you go back to the
bronze age, there is one reference to Athens which many think was stuck in later. It was a
reference to Crete; Homer sucking up to Athens. You could replace a reference to Crete
with Athens without pissing anyone off.
 The soil around Athens was not good for much except for growing olive trees. For
Athens to go from being an impoverished state to the home of Plato, Socrates, this took
some major changes.
 This took some policy changes implemented by Solon. Solon was supposed to have
implemented a monetary reform and we don’t know what Athenians used as money
before Solon. He implemented something called a monetary reform but we don’t know
much more than that
 What Solon did was turn Athens into a trading state by discovering Silver in a place
called Laurien. A combination of silver and olive trees gave them the start in trading.
 Whether you are going to devote your entrepreneurial abilities to whatever activites to
whatever is going to yield the greatest return which has the basic rules being set by the
government
 Solon created a set of ruled that favoured entrepreneurship and the Athenians became
traders in the sense that the carried goods from one part of the Mediterranean to another.
They became an intermediary. Traders all went to Athens because they knew everyone
else was going to Athens so everyone met in Athens and they were all in the market place
in the port of Perius. They built a trading infrastructure which was primarily warehouses
so traders could store their goods there and sell them. They developed a set of courts to
 deal with trade disputes so they did not have to wait months for them to get settled in
regular courts where they probably never would have been resolved. These courts
essentially dealt with commercial law. This made Athens the most attractive place in the
Mediterranean because they knew other traders were going to be there. Infrastructure was
created for trading.
o The result was from 700 to 300 BC, they became the richest of the city states
o They then went from being trading people to snobs
 By 300 BC, most business in Athens, most business was not being conducted by
Athenians but rather by Metics – resident traders. The most socially acceptable way to
make an income was off his agricultural estate.
o Socrates father employed a fair number of workers but they were either slaves or
foreigners. It was rare for one Athenian to be employed by another Athenian.
o Their agricultural estates mainly produced olives but by this point, trade had
become such an integral part of Athens and if you grew olives, you had simply
had to export them to another part of the Mediterranean.
 The warehouses and the ports were run on a commercial basis
 You have all this activity going on in the Agora which was divided up into zones with
sculptures in one sector. You had a well-established commercial centre in Athens.
Housing prices were higher the closer you were in the more expensive parts of the Agora.
You need a banking system to run this kind of activity. Athens had a banking system
similar to todays, and Athens was a major banking centre in eastern Mediterranean.