Archeologists offer clues about wealth and income inequality

Tom Saler | Special to the Journal Sentinel

Digging for information goes with the territory for economic historians. But in their recent book, “Ten Thousand Years of Inequality,” archeologists Michael E. Smith and Timothy Kohler take the excavation of revelatory clues to a deeper level.

Though the French economist Thomas Piketty documented shifts in wealth and income distribution since the industrial revolution in the mid-19th century, the lack of written records has impeded similar research covering prehistory. That’s where Smith, Kohler and the roughly two dozen archaeologists whose findings they edited hit upon a credible solution: using house size from 63 previously excavated sites in the ancient world as a proxy for wealth inequality.

Their findings, which cover the period from about 11,000 years ago at Jerf el Ahmar in modern-day Syria to 500 years ago in modern-day Mexico, are quantified with the Gini coefficient, in which a reading of 0 represents total equality and 1 indicates maximum inequality.

It turns out that the inequality that Piketty documented is no recent phenomenon.

“Wealth distinctions have been with us for a long time,” Smith said in a phone interview. In one primitive form or another, technology usually was the catalyst for each rise in inequality.

Trends from antiquity

The earliest data derives from Eurasian foraging societies that averaged only 0.2 on the Gini wealth scale, or one-fourth that of the current 0.8 reading for the U.S.

“You couldn’t find a single nation today with a 0.2 Gini,” Smith said of the hunter-gatherers. “The low number was mostly due to their relatively high mobility on the landscape. It’s hard to accumulate material possessions if you are moving every few days to every few months.”

That began to change — albeit slowly — with the domestication of plants and animals about 10,000 years ago. Farming requires more permanence, which in turn allowed for accumulating and storing items of value. Still, inequality crept only marginally higher during the first several centuries of agriculture, averaging only about 0.35 on the Gini meter.

But that modest number masked an important development that took root about 4000 BC in the Old World: the use of draft animals to accomplish what Smith called agricultural “extensification.” Besides expanding farm size, “agricultural extensification worked on both ends of the wealth spectrum,” Smith explained. “Not every farmer could afford a herd of oxen, so richer farmers rented them out. It was a mechanism for the slightly richer to become even richer.”

Waiting for Solon

The newly documented rise in wealth inequality since antiquity expands upon what the historians Will and Ariel Durant reported in the their 1968 book, “The Lessons of History”: “We conclude that the concentration of wealth is natural and inevitable, and is periodically alleviated by violent or peaceable redistribution.”

According to Smith, however, “there’s a large component of social and political decision-making that goes into determining how evenly wealth is distributed in a society.” He cited Tenochtitlan, the Aztec capital in what is now Mexico City, whose Gini coefficient was just 0.3 before the Europeans arrived, or barely half the level that Pompeii reached 1,400 years earlier.

“There were no obvious palaces for nobles or depictions of rich kings that you often had in the Old World,” Smith said of Tenochtitlan. “State level civilizations do not need to have extremely high wealth distinctions. It is a decision. It doesn’t have to be that way.”

Nor, it seems, can it remain that way forever.

In the Athens of the sixth century B.C., economic inequality had soared to a level that threatened to send the city-state into civil war.

According to the Greek philosopher Plutarch, “The disparity of fortune between the rich and the poor (had) reached its height; so that the city seemed to be in a dangerous condition, and no other means for freeing it from disturbances…(seemed) possible but a despotic power.”

Rather than turning to a despot intent on stoking hierarchical anxieties, Athens was saved by the statesman-poet Solon, who used his gift for language to inspire an open society and peaceful redistribution of wealth. Solon’s reforms, while failing to completely satisfy the rich or the poor, were nonetheless palatable to both.

America awaits a modern-day Solon.

Tom Saler is an author and freelance financial journalist in Madison. He can be reached at tomsaler.com.