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It has been stated by Arnold J. Toynbee and James Burke that:

The economy of the Empire was a Raubwirtschaft or plunder economy based on looting existing resources rather than producing anything new. The Empire relied on booty from conquered territories (this source of revenue ending, of course, with the end of Roman territorial expansion) or on a pattern of tax collection that drove small-scale farmers into destitution (and onto a dole that required even more exactions upon those who could not escape taxation), or into dependency upon a landed élite exempt from taxation. With the cessation of tribute from conquered territories, the full cost of their military machine had to be borne by the citizenry.

To what extent is this true and the dominant economic force in the Empire? That is, were there other powerful economic influences or was the plunder economy dominant?

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I removed the rome tag, as it should only be used for the city of rome. –  Dan the Man Oct 13 '11 at 20:22
    
"by the citizenry". I do not think Roman citizens participated in productive labour. Production on the territory of Rome depended on [influx of] slaves... This in turn depended on successful conquers or on hold on colonies. –  Andrei Oct 13 '11 at 20:58
    
@Andrei and you'd be completely wrong. The average Roman citizen was a productive citizen. Slaves were mainly used for physically demanding labour or to increase the workforce to beyond what the citizenry could provide. Things like stoking fires, mining, farm work, and for the aristocracy as a status symbol as servants. –  jwenting Apr 2 '13 at 6:20

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The ORIGINAL Roman Republic (prior to the Punic Wars) was a prosperous, self-sufficient economy based on affluent, independent, and relatively free yeoman farmers enjoying a steady rate of technological advances. Because of this, Rome had a relatively representative government (the "veto" was originally a device to protect the common people).

One can argue that a long series of wars in Carthage, Greece, Spain, the Middle East, Gaul and Britain (that were at first defensive, and later offensive) turned a victorious Rome into a plunder economy. (People even have similar fears today regarding the United States.)

But that was NOT the way that the country was "set up."

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I have to agree with you here. It was certainly not what the Romans set out to do, though it may have happened in the end. Worth noting though, is that wherever they plundered they also built an infrastructure and trading posts, supported by a Roman garrison. –  Noldorin Oct 19 '11 at 22:21
    
Before the first Punic war, the Roman Republic was just a loose federation of City-States, kind of like ancient Greece. They didn't even encompass all of Italy until right before Hanibal invaded (and he spent most of his time trying to undo the very recent alliances between the cities). –  T.E.D. Apr 6 '12 at 13:58
    
The Roman empire was a combination of both. While there was plunder, it was unlikely this was ever enough to sustain the system. And outlying regions were developed and eventually became fully functional provinces where the inhabitants were citizens of the empire, with no different status from those at the core. –  jwenting Apr 2 '13 at 6:22

Personally, I don't buy it. If they had been really based on plunder, the sensible thing to do would have been to leave the destitute Celts and Germans alone, and go wipe out the Persians. They had multiple opportunities to do that. If anything, the Romans tried to do the opposite.

There are oodles of theories for the decline of the Roman Empire. The nicest thing I can say about that one is that it's one of them. :-(

Personally, I'm not entirely sure what the cause was (or even if there was a cause). I do know that there were a whole lot less people in the developed areas of the empire in the 3rd century than there were in the 2nd. Whether that was a cause or effect I can't say. But losing that many people in an economy based ultimately on labor is going to contract the horizons of any civilization.

The military balance of power passing to cavalry certainly didn't help. Farming societies have trouble developing Calvary competitive with nomadic herding societies (where everyone lives on horseback).

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The Romans did try to do that at least once. In general, though, Parthia was rather strong, and the Romans probably weren't in a position to seriously consider it until the very late republic after the Mithridatic Wars were concluded. Crassus, of course, died trying his hand at Parthian conquest, and Caesar was supposedly planning one when he was killed. –  ricree May 23 '12 at 23:46
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I mostly agree with you but one must point out that the Romans did develop their cavalry arm quite well, exactly in order to deal with the barbarian invasions. There is some debate but basically the switch can be attributed to Gallienus's reforms (I grew up thinking he was a debauched drunkard; but apparently he was both that and a military reformer). –  Felix Goldberg Jan 9 '13 at 9:34
    
And that cavalry arm at least initially was made up mostly of people from the colonies and outlying regions, where there was an existing tradition of horsemanship. –  jwenting Apr 2 '13 at 8:41

No, this is based on a superficial reading of history. Toynbee was out to construct a grand unified theory of history. It's great fun but the finicky details just have to be swept under the rug for the theory to look impressive.

Let's look at it periodwise: Early/Middle Republic: An agrarian society (see Tom Au's answer) Late Republic: Rome was constantly expanding and conquering new lands, that is true. It was also woefully exploiting and mismanaging the new lands it had acquired and driving them into debt (check out the publicani). But was the expansion necessarily driven by plunder or the other way around? There is not real evidence for that, although it has long been a staple of Marxist historians. Early Empire: No conquest, no plunder, no destitution of small-scale farmers. (Yes there is that famous quote "latifundies have destroyed Italy" but it's just that - good copy). Read Rostovzeff - the Empire was prosperous, the best time for people to live in - materially speaking - to live in till, say, the 16th century, at least. And yes, it was, to a large degree (but not completely!) a slave economy. So where did they get the slaves? They bred them. (See this paper for a dissection of the way this simple issue got muddled in the 19th century). Late Empire: That's when the empire supposedly did turn into a too-heavy military machine relying for its maintenance on a huge bureaucracy that sucked the life out of the peasants. But as the previous period shows, this was not a structurally pre-determined situation.

And one more thing: the military machine built by Augustus and that was in place for all of the Early empire's duration (200 years) was actually a relatively small one; some historians even claim it was intentionally designed that way on order to disable future rulers from embarking on unbridled conquest, which Augustus thought could be very destabilizing. Others diagree, of course, about his intention, but there is little argument that the Principate's military establishment was in fact small and economical.

To sum again: Toynbee posited a theory that got only 2 of the 4 periods right and even there when you look at the data the fit seems rather contrived. But it's surely all great fun.

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1) the slave economy was mostly confined to specific industries, like farming and mining. 2) a lot of slaves were convicted criminals and prisoners of war, while indeed others were bred as offspring of other slaves. 3) the late period appeared as you describe superficially, in reality if was the result of strategic overstretch, the remote regions being effectively independent kingdoms where it was all too easy for the ruling military governors to get ambitions of imperial status, getting them to march on Rome. This led to an increase in the legions all around in competition for the throne. –  jwenting Apr 2 '13 at 6:26
    
@jwenting: The late period (as almost everything) is subject to various interpretations. The notion of strategic overreach and independent kingdoms is interesting but I have doubts about it: (a) The borders were practically the same as under the Principate (b) the rise of usurpers was not a constant phenomenon but only happened in time of crisis - to wit, for most of the 4th century there were no usurpers and the emperors had full sway over the whole empire. But I do concur that the dissipation of manpower in the civil wars that attended the crises was very very bad for the empire's prospects. –  Felix Goldberg Apr 2 '13 at 6:43
    
@jwenting: But I take it that we are in substantial agreement over the (in)significance of the slave economy? –  Felix Goldberg Apr 2 '13 at 6:44
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I'd say the slave economy was important for the empire but not in itself a factor in whether plunder was an big part of the GNP of the (core) empire. As to strategic overstretch, the borders may have been the same, but the core was becoming weaker and weaker, control over the remote areas was getting less, at the same time as those areas became economically stronger (which itself puts the lie to the idea that those areas were regularly plundered to feed the core). –  jwenting Apr 2 '13 at 7:07

All good points. But it is unwise to doubt James Burke. Yes, Rome did build roads, cities, etc., in the areas it conquered. But that didn't make up for the destruction it did. Consider the Gauls. No, they were not at a level of technology as good as the Romans or Greeks, but they were by no means barbarians. What did Ceasar bring them? Destruction and slavery. Consider Dacia. A country destroyed and a people sold into slavery for no other reason than the hord of gold that it kept. What did Trajan do with that wealth of gold and tens of thousands of slaves? Made Rome more beautiful for Romans, and that was it. Everything that Rome did was to support that plunder economy, either outright looting or its slave system. I think a more important question to ask is why the easter empire survived when the west didn't. Did the east have a better, more honest system based on hard work and merit? Not that I heard. Maybe I'll send a letter to James Burke and ask him.

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Nice rhetoric, but as you point out yourself, the theory just doesn't work. Btw, who is James Burke? –  Felix Goldberg Apr 1 '13 at 6:58
    
This answer has the potential to be very good, if only it included more citations and less rhetoric. The facts are there, but if I'm fascinated with the assertions, there is no way for me to go further and learn more. Thank you for the beginning of an excellent answer. –  Mark C. Wallace Apr 1 '13 at 10:52
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the answer is completely bogus. For the most part the Romans brought prosperity and eventual citizenship to the areas they conquered. Dacia and Carthage were the exception rather than the rule. Judea was severely punished several times during rebellions yet always rebuilt too. –  jwenting Apr 2 '13 at 7:09
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@jwenting: Indeed, what Don missed is that Rome eventually assimilated the peoples it conquered; so when an emperor "Made Rome more beautiful for Romans, and that was it." he was benefitting all the people conquered so far as well. Of course the people conquered at this very moment could not appreciate that very much - but their descendants did get the opportunity to become Romans and enjoy the fruits of the next conquests. Sort of a bloody Ponzi scheme, if you like :) <ok, maybe I got a bit carried away....> –  Felix Goldberg Apr 2 '13 at 8:14
    
@FelixGoldberg not a Ponzi scheme, people actually did get better from it other than the core of the empire :) And most often not that bloody, if an area submitted to Roman rule they'd be mostly left alone as long as they paid their taxes, Romans had better things to do than instigate rebellion by being brutal and overtaxing except where needed to suppress rebellion already underway. –  jwenting Apr 2 '13 at 8:40

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